If you are looking to buy property in Israel, you have probably stumbled upon a statistic that sounds terrifying:
93% of the land in Israel is owned by the state.
This leads to the obvious question: If the state owns the land, do you actually own your home?
And the million-dollar follow-up: Can the government kick you out when the lease expires?
If you are coming from the US, UK, or Canada, the Israeli system sounds confusing. Maybe even risky.
But here is the truth:
While the system is different, it is extremely secure—if you understand how it works.
In this guide, I’m going to break down exactly how land ownership works in Israel, the difference between “Tabu” and “Minhal,” and why the lease expiration date is (usually) nothing to worry about.
Let’s dive right in.
The Two Types of Ownership: Private vs. State
To understand the Israeli market, you need to understand the two buckets of land classification.
1. Private Land (Freehold)
This is the “American style” ownership you are likely used to.
- The Stat: It makes up only about 7% of the land in Israel.
- Where is it? Mostly in central cities like Tel Aviv, Jerusalem (Rehavia, Talbiya), Ramat Gan, and Petah Tikva.
- The Deal: If you buy here, you own the land and the building forever. There is no lease. There is no government landlord.
2. Israel Land Authority (ILA) Land
This is the vast majority of the country.
- The Stat: Roughly 93% of land.
- The Owner: The land is owned by the State of Israel, the Development Authority, or the Jewish National Fund (KKL).
- The Manager: It is all managed by one body: The Israel Land Authority (known in Hebrew as the Minhal).
When you “buy” a home on this land, you aren’t technically buying the dirt. You are signing a Long-Term Lease (usually 49 or 99 years).
This creates a legal concept called “Chakerah” (Leasehold).
The Big Fear: “What Happens When the Lease Ends?”
This is the number one question from foreign investors.
You sign a 99-year lease. 99 years pass. Does the government come and take your house back?
The short answer: No.
The long answer: In the past, this was a bureaucratic headache. You had to pay a “renewal fee” to extend the lease.
However, a massive reform passed involving the Capitalization (Hivun) of leases.
Here is how it works today: When a developer builds a project, they pay the Israel Land Authority for the full 49 or 99 years upfront. This is called a “Capitalized Lease.”
Because the money is paid upfront:
- Renewal is Automatic: You do not need to file paperwork to renew the lease.
- Renewal is Free: You do not pay more fees when the period ends.
The state of Israel essentially treats these long-term leases as ownership. Evicting someone at the end of a lease would require a change in Basic Law and would cause a total collapse of the Israeli real estate market. It simply doesn’t happen.
The One Exception: Church Land
There is a specific, rare scenario in parts of Jerusalem (like Nayot and Talbiya) where land is owned by the Greek Orthodox Church and leased to the state/residents.
These leases are not state-guaranteed in the same way. As these leases near expiration, property values there have fluctuated wildly because of the uncertainty. Unless you are a highly sophisticated investor, you want to stick to State (ILA) or Private land.
The “Holy Trinity” of Registration
In the US, you have a Title Company. In Israel, you have three different places where your home might be registered.
Knowing which one your property is in is critical for your due diligence.
1. The Tabu (Land Registry)
This is the Gold Standard. The Tabu is the government body that records rights to real estate. If a property is “Registered in Tabu,” it means the land has been properly parceled (divided), and you have a specific extract (Nesach Tabu) proving your rights.
- Verdict: Best case scenario.
2. The Minhal (Israel Land Authority)
Sometimes, the registration hasn’t made it to the Tabu yet. This is common in newer developments. The rights are recorded at the Israel Land Authority.
- Verdict: Perfectly safe, but the bureaucracy for transferring ownership takes a little longer.
3. Chevrah Meshakenet (Housing Company)
When a building is brand new, the registration isn’t in the Tabu or the Minhal yet. It sits in a temporary registry managed by the law firm of the developer who built the tower.
- Verdict: Standard for new builds. Eventually, the lawyer must transfer the registration to the Tabu, but this can take years.
Important Terms You Must Know
If you are reading contracts or listings, you need to speak the language.
1. Hivun (Capitalization) Always ask: “Is the land Mahuvan (capitalized)?” If the answer is YES, you have nothing to worry about regarding annual lease fees or renewal costs. 99% of apartments you look at will be capitalized.
2. Nesach Tabu This is the title deed. It shows who owns the property, the size of the apartment, and if there are any liens (mortgages) or “Warning Notes” on it.
3. He’arat Azhara (Warning Note) This is vital. When you sign a contract and pay the first installment, your lawyer immediately registers a “Warning Note” in the Tabu. This warns the world that you have bought this property, preventing the seller from selling it to someone else (a “double sale”).
The Bottom Line
So, is the Israeli system different from the US? Yes.
Does the government own the land? Technically, yes.
Does it matter for your investment safety? Mostly, no.
As long as you are buying a property with a Capitalized Lease (which is the standard), your rights are virtually identical to freehold ownership. You can sell it, inherit it, renovate it, and mortgage it just like a standard home.
The Takeaway: Don’t let the “Leasehold” label scare you off. In Israel, a long-term lease is as good as gold—provided you have a good lawyer to check the registration.
