Israel’s official home price index rose 0.1% for May-June deals, its first rise since February-March and only its second since the declines began in the winter. The map split hard: Jerusalem rose 1.8% and Haifa 1.5%, while Tel Aviv fell 0.7% and the Center district fell 1.0%. Prices are still 1.5% lower than a year ago. New homes rose 0.5%, but strip out state-subsidized deals and they rose 0.9%. Rents kept climbing: a renewed lease cost 2.6% more, a new lease 4.7% more. Away from the data, a builder lost its contractor license for three years because its foreign construction workers were found welding in a metal shop. A district court made the state pay a man whose home it demolished over his own building violations. And a planning appeals committee ordered Rehovot and Nes Ziona to compensate farmland owners for a road the city paved on land it never owned.
Five falling readings, then plus 0.1%
The slide paused. The Central Bureau of Statistics published its dwellings price index on Friday, August 14, and deals signed in May-June came in 0.1% above April-May. Every reading since December-January had been flat or falling, except one small rise in February-March. The last reading before this one was a steep 1.1% drop.
One national number hides two different countries. Compared with the prior period, prices moved like this:
| District | May-June change | Versus a year ago |
|---|---|---|
| Jerusalem | +1.8% | +1.8% |
| Haifa | +1.5% | -1.8% |
| North | +0.9% | +1.6% |
| South | +0.7% | +0.1% |
| Tel Aviv | -0.7% | -1.7% |
| Center | -1.0% | -4.1% |
Nationally, prices are still 1.5% below last year. The spread between Jerusalem and Tel Aviv in this single reading is 2.5 percentage points, our own subtraction from the two official district numbers above. Why the geography matters is a story this site already tells in full at semerenkogroup.com/israel-housing-market-splits, and last month’s steep reading is covered at semerenkogroup.com/home-prices-crack-as-israel-heads-to-elections.
New homes carry a hidden asterisk. Their index rose 0.5%, but the CBS notes that state-subsidized deals grew to 38.4% of all new-home sales, and with those subsidized deals removed, free-market new homes rose 0.9%. So the discount channel is expanding while open-market prices firm up.
Renters got the same release with worse news. In the July consumer price index, published the same day, rent rose 2.6% for tenants who renewed and 4.7% where a new tenant signed. On a NIS 6,000 flat, that gap is about NIS 126 a month, our own calculation from the two official rates. Staying put is currently the cheapest move a renter can make. Annual inflation, for context, fell to 1.5%, its lowest in five years.
For a buyer, the practical read is city by city, not national. A Jerusalem seller just got 1.8% more confident. A Tel Aviv or Center-district seller is still watching prices fall and is more open to an offer below asking. Sources: CBS release, August 14, Ynet, August 14, Globes, August 14.
Two Thai workers in a metal shop cost a builder its license
Israel is short of construction workers, and the state just showed what happens to a builder that leaks them. The Contractors’ Registrar suspended the license of Ofek Mehandesim Yoazim Ltd for three years and fined it NIS 20,000, in the first enforcement case built jointly with the Population and Immigration Authority, the trade outlet Nadlan Center reported on Friday.
Inspectors visited a metal and carpentry workshop in the south and asked the foreign workers there for their papers. The papers said construction. The workers had been allocated to Ofek for a building site in Dimona, yet they were working a welding shop and a machining plant instead. The Housing Ministry confirmed the case on the record and said it believes more allocated construction workers are quietly working other industries. The company called the decision unfair, said the two Thai workers spent only two days in its own workshop on pre-production tasks, and said it will appeal.
The timing gives the case its edge. Israel froze new foreign-builder hiring this week because every quota slot is taken, a story covered at semerenkogroup.com/israel-freezes-foreign-builder-hiring-homes-wait. Each leaked worker now comes straight out of someone’s unbuilt apartment. If you are buying from a small contractor, this is one more reason to check its license status before signing, and semerenkogroup.com/top-construction-builders shows how.
The state demolished his home. It owes him key money anyway
Shmuel Attia was born in 1960 in the Pardes Rosenblum transit camp in Givat Shmuel, in a house owned by the Jewish National Fund. Over the years he and his father illegally expanded the family home from 130 square meters to 500. A criminal court ordered the additions demolished, and in 2013 the Israel Land Authority tore the whole structure down.
In a ruling reported on Friday by Bizportal, the Central District Court held that the state must still compensate him. Attia was a protected tenant, an old legal status that shields a resident from eviction for life. Judge Moti Firer held that this status can only be ended by a civil eviction judgment, and no one ever filed for one. The criminal demolition order punished the building offenses. It did not touch the tenancy. In the judge’s words, the landlord cannot demolish the rented home itself and then treat the tenancy as gone for free.
Attia sued for NIS 9 million. The court awarded him 66.66% of the key-money value of the original house, a figure a court-appointed expert will now set. Key money is the old system where a protected tenant paid a large one-time sum for lifetime rights. His own two appraisals valued the rights at 2.7 and 4.7 million shekels, so the award should land roughly between NIS 1.8 and 3.1 million, our own arithmetic from the court’s fraction applied to those two appraisals. The real lesson sits with anyone on either side of a protected tenancy, a status explained at semerenkogroup.com/protected-tenancy-key-money: without a civil eviction case, the right survives almost anything, including the tenant’s own violations.
The road Rehovot paved on someone else’s farmland
A city paved a road on private agricultural land it did not own, without a building permit, before any plan allowed it. Then it passed a plan to legalize the road after the fact, and asked to pay the landowners nothing. The Central District appeals committee for compensation and betterment refused, in a decision reported by Bizportal on Friday.
The committee’s own words are unusually sharp. It wrote that Rehovot “seized possession of land not its own” and behaved in a way that “does not befit a public authority.” The land sat in Nes Ziona’s jurisdiction, so both cities’ planning committees are now on the hook for compensation, but the committee placed the blame squarely on Rehovot, which initiated the plan and did the paving.
The money fight was about what seized land is worth. An advisory appraiser said the rezoning caused zero loss, since farmland was worth about NIS 50 per square meter before and, in his view, after. The owners argued no willing buyer pays anything for a strip already buried under asphalt. The committee agreed with the principle and adopted the owners’ figure of NIS 36 per square meter. On the 6,287 square meters under the road, that is a 28% value cut, about NIS 88,000, our own multiplication of the 14-shekel difference across the strip, and another 2,232 square meters that the plan left landlocked will be assessed on top.
For any owner of farmland near public works, the decision says two useful things. Possession taken without process does not erase the bill, and an appeals committee will overrule its own advisory appraiser when the math ignores reality on the ground.
Sources
Central Bureau of Statistics, dwellings price release, August 14 · Central Bureau of Statistics, July consumer price index, August 14 · Ynet, July index and home prices, August 14 · Globes, inflation at 1.5%, August 14 · Nadlan Center, contractor license suspension, August 14 · Bizportal, Attia protected-tenancy ruling, August 14 · Bizportal, Rehovot road compensation decision, August 14
