After a long period of rumors, Minister of Finance Moshe Kahlon has unveiled the measures he plans implementing in his housing plan. Kahlon said that since entering office, he has held dozens of meetings on the matter and over the past week he met Prime Minister Benjamin Netanyahu twice to finalize his plan. This plan will be submitted for approval to the next housing cabinet meeting.
The Ministry of Finance says, "The first stage of the plan includes a number of measures that provide a response to the range of obstacles and problems that typify Israel's housing market. The aim is to moderate the rise in prices in the market and help young couples wanting to buy their first apartment."
The plan includes the following measures: encouraging converting apartments used as offices into residential apartments, fast track for splitting apartments for rent while maintaining decent residential spaces, promoting construction of homes on publicly zoned land, and broadening the definition of a location's young generation for allocations from the Israel Land Administration (ILA).
In ILA and Construction and Housing Ministry tenders, Kahlon will expand the price for tenant program but it is unclear if all tenders will be issued using this method. Kahlon also said that he will expand discounts on tenders and broaden the criteria for first time buyers.
The plan also relates to the work force in the construction sector. The Ministry of Finance intends providing grants to encourage a change in regulations regarding industrialization, increasing the number of workers in the sector by training Israelis and adding foreign workers.
The plan also includes tax changes to "restrain demand for homes for investment." The Ministry of finance wants to increase purchase tax to 8-10%.
Published by Globes [online], Israel business news - www.globes-online.com - on June 11, 2015
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