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Israeli Real Estate Prices And Demand Still Growing

Property Wire
Israeli Real Estate Prices And Demand Still Growing - Israel - property price - property market


Serious supply shortfalls that kept Israel's real estate prices afloat while the global market sank, now are threatening to form a bubble, and it could be 2012 before the supply issue is resolved. Real estate prices, along with demand, are still growing despite a hike in interest rates and efforts to boost available development land. See the following article from Property Wire for more on this.



More famous for its war with Palestine than its real estate market, Israel is, however, getting worried about a property bubble and interest rates are set to rise again to cool the sector.  

The country has seen six interest rate raises in just over a year and so far they have not dampened demand. Economists believe that if prices continue to rise at the current pace the real estate market will start to bubble.
 
Experts point out that banks in Israel have avoided a US style subprime mortgage crisis and its financial market is not intertwined with the mortgage market. Down payment requirements for buying are high, often equal to more than 40% of a property’s value.
 
As real estate markets around the world stalled and ground to a halt Israel has seen a 30% jump in prices since September 2008. This increase has been fueled by a lack of supply, one factor that is, ironically, preventing the peace process because of the drive to build new homes, many on land claimed by Palestine.

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