"In the last four years, home prices in Israel have actually fallen by 20%, Tidhar CEO Uri Levin told the EY Israel annual real estate conference today in Tel Aviv. "Financing promotions, benefits that have become widespread, and more, mean that this decline is not seen in the numbers. The difficulty for the Central Bureau of Statistics to reflect this decline in its data means that the psychological effect of such a price drop is not actually reflected in the market."
Levin added: "We are in one of the most challenging periods for the real estate market ever, but the Israeli market is one of the strongest in the world. "We sell apartments, but the market has changed, it is different,"
He continued, "The construction market went through a very severe upheaval following October 7. First, construction was prohibited, then there were no workers, following the ban on Palestinian workers entering Israel. Currently, there is stability in the quantity of workers, but not in quality. The market lacks quality workers. The construction sector is in a difficult situation - but in my opinion, it is the more optimistic sector in the market. There is demand, the infrastructure is moving forward, there is a Metro that is starting to get underway, data centers. The demand in this sector is enormous, and it is amazing to see how the market knew how to correct itself without the Palestinian workers."
The challenging situation in the offices market
Admittedly, the office market is in a more complex situation. There are buildings that have been empty for a while, including in Tel Aviv. I say that when it is difficult, you should build, but only if the company can face the possibility that the building will be completed and stand empty for three years. Otherwise simply do not build. The office market is Israel's economy, and we are in a reality where today Israeli technology companies can be number one in the world in their field, from within Israel. This is something that could not have happened five years ago, and this can greatly affect the state of the office market. Recently, we have seen a recovery in the office market in Tel Aviv, the beginning of a recovery, and there is tremendous demand."
Levin estimates that the complex situation at the moment will continue for quite some time: "The sales market is greatly complex: sellers in the periphery, sellers in other places too - but less. Interest rates will fall, but not for much longer. We need to get used to the idea that we will live in a world with high interest rates. "We are in a complex world, and it is not certain when this reality will change. Crises can take a long time. We need to prepare for a long period of crisis. I hope I am wrong, and that things will soon turn around following an agreement with Saudi Arabia, perhaps following the upcoming elections - anything is possible, but we need to prepare for the worst-case scenario. Real estate companies need to reduce their dependence on financiers, on banks, reduce leverage, turn the asset pool they hold into a profitable pool and know how to deal with the crisis independently."
Published by Globes, Israel business news - en.globes.co.il - on July 1, 2026.
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