Apartment prices in Israel rose 0.9% in July according to the Home Prices Index after rising 1.2% in June, the Central Bureau of Statistics reports. Home prices rose 6% in the 12 months ending in July 2015, up from 5.1% in the 12 months ending June.
The latest surge in home buying began at the end of 2014 after homebuyers realized that the previous government's 0% VAT plan for first time buyers, promoted by then Minister of Finance Yair Lapid, was not going to materialize. Israelis rushed to buy and the trend strengthened after the current Finance Minister Moshe Kahlon decided to raise purchase tax for homes for investment, pushing people into the market before the hike was implemented.
Since the start of 2015, home prices have risen 5.2%, figures that are backed up by data from the Ministry of Finance, which show a substantial rise in the number of deals, and data from the Bank of Israel showing record levels of mortgage taking.
Since May 2007, when the latest wave of home price rises began in Israel, home prices have risen by 108%.
Published by Globes [online], Israel business news - www.globes-online.com - on September 16, 2015
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