Israel Builders Association president Nissim Bublil says that home prices will rise moderately in 2013. He added, "We are again seeing that all the efforts to reduce housing demand are useless, and without efforts to boost the supply, apartment prices won't fall. The Israel Builders Association's forecast in 2011 that home prices would rise by 6% in 2012 materialized."
Bublil said that there had been a regression in efforts to increase the housing supply, including reduced marketing of land in high demand areas and a slump in housing starts. "Government promises to increase credit to the industry and increase skilled labor, which are preventing increasing the housing supply, have not been kept. At the same time, the mortgage restrictions imposed by the Bank of Israel do not help reduce demand, but only continue to hurt young couples who cannot afford to buy an apartment."
Bublil said, "We have been hearing about plans by the Ministry of Finance to impose further restrictions on investors, but it has already been proven that this only results in higher rents. It should be remembered that at the same time that home prices rose by 6% in 2012, rent also rose by 6%, which mostly affected the same young couples who continue to pay huge sums on rent while their dream of buying a home drifts further away."
Published by Globes [online], Israel business news - www.globes-online.com - on February 19, 2013
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