Foreign buyers flock to the Israeli real estate market

Realtors report that American Jewish buyers have completed dozens of deals for luxury homes in Israel over the past year, mostly in Tel Aviv and Jerusalem. The deals were made through transatlantic Zoom calls, emails, and even people sneaking into Israel despite the skies being closed.

“The Wall Street Journal” devoted a major article to the issue last week in an article titled “US Buyers Flood Tel Aviv Real Estate Market”. The article spoke of dozens of offers and the current major interest in luxury homes in Tel Aviv.

According to the article, Matthew Bortnick, director of Tel Aviv-based Beauchamps Estates, said: “The market was once dominated by British and French buyers, but the Americans now match them. Bigger deals and high end the luxury market is also dominated by Americans. ”He said the biggest sale of 2020 was an American couple’s purchase of the Arlozorov 17 condo, for NIS 84 million, or $ 25.2 million.

Tel Aviv-based real estate agent Oren Katz, who specializes in the high-end market, shares the sentiment expressed in the article. “Until now, the market has been mostly British and American and the American market has been dormant. Here and there people could buy but suddenly there is a real buzz with people who have made a decision.”

Among other things, Katz has represented Russian-Israeli billionaire Roman Abramovich in his major real estate transactions in Israel. Katz added: “There is interest and a lot of emails and US brokers are contacting us about collaborations. This is something we didn’t know before. After the first lockdown, contacts with Israel started. . In the last few months we have been visiting properties with Americans. Some of them may have Israeli citizenship and others I do not know how they entered the country. With most of the agreements, we are contact online or by phone. “

“The Wall Street Journal” also quoted Inna Fleshler, marketing director of Israel Sotheby’s International Realty, as saying that “most high net worth clients want properties that are either directly on the waterfront or on a side street. withdrawal of water, which has pushed the average price of prime beachfront properties to $ 4.8 million. Demand is constant. Tel Aviv is a hot market. there isn’t a lot of space to build. “

According to “The Wall Street Journal” “The job opportunities and trendy city vibe attract a young mix of international residents, while the year-round good weather and beachfront location appeal to families and retirees alike. . “

Declining purchasing years

On the other hand, the chief economist of the Ministry of Finance said that only 420 apartments were sold to foreign residents in the first half of 2020. The chief economist noted: “If it is safe to assuming that the low number of purchases by foreign residents was recorded to a large extent due to the technical difficulties for foreigners entering Israel, in many cases foreign residents were helped by Israeli contacts and there was no therefore has not a single explanation for the fall. “

The real estate market for foreign buyers has been in decline for 15 years. The peak was in 2005 and 2006 when 5,000 apartments were sold in each of those years, representing 6% of all apartment sales in Israel. The numbers have fallen sharply, especially after the 2008 financial crisis.

A third of all apartments sold in Israel to foreign residents have always been in Jerusalem, for religious reasons. After that, the Sharon area and in particular Netanya and Herzliya Pituah were popular with foreign buyers as well as Tel Aviv.

Oren Cohen, who specializes in high-end properties in Jerusalem, speaks of dozens and perhaps even hundreds of American Jews who have shown interest in Israeli properties over the past year. He said: “I have made some very expensive deals through Zoom and I am in touch with others who are afraid to make such expensive deals online and they are waiting for the sky to fully open before they can come to Israel. and make the deal. “

Cohen and Re-Max – Hazon real estate agency franchisee Ariel Mirsky said that while until recently people bought 2-3 room vacation homes in the city center or in Mamilla or near the Kotel, foreign residents now buy 4, 5 and even 6-room apartments. Previously the apartments were for vacations, but now the apartments are being sold to families who plan to live in the city at some point in the future.

Ashkelon is another surprisingly popular place. RE-MAX Ashkelon franchisee Yareon Rosenhek said American Jews have never shown interest in the southern coastal city in the past, but in the past few months he has received 12 requests from American Jews considering buying property in Ashkelon. “This is a new trend for American Jews considering immigrating to Israel and settling in Ashkelon,” he said.

Katz speculates that the reason for the growing interest of American Jews is that in the United States in 2021, Jews feel less secure than in the past.

Cohen says he feels this with the religious Jews he deals with in Jerusalem who feel an atmosphere of political and economic instability in the United States. “The protests there and the assault on Capitol Hill and the way Covid-19 was handled in Israel versus there convinced them.”

But with most people reluctant to make any deals on Zoom, it’s only when the skies fully reopen that we’ll find out just how serious this trend is.

Posted by Globes, Israel Business News – – March 21, 2021

© Copyright of Globes Publisher Itonut (1983) Ltd. 2021

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