Minister of Housing Uri Ariel continues to promise that home prices will fall this year. He remains proud of the record marketing of land, despite the problems in marketing, and although it is unclear how much of the land marketed will eventually be transformed into apartments built. During his appearance at the “Globes” Real Estate Summit - Israel Real Estate and Infrastructures Conference in collaboration with Mizrahi Tefahot Bank (TASE:MZTF) in Tel Aviv, hecklers shouted that Ariel had made the same promises two years ago as he was making today.
Ariel said, "I'm still faithful to my declarations that in 2015 home prices will fall. We've tripled planning, there is an operations headquarters for apartments that has put in billions of shekels in order to remove obstacles for electricity and infrastructure in the housing sector. We broke the all-time record for marketing land since the founding of the state.
"Prices did not slow down in 2014 as I had expected because Yair Lapid held up the target price plan and his 0% VAT plan disappeared. In actual fact, we marketed thousands of housing units and we will market another 12,000 apartments this year at a discounted target price of 20% and that will impact the market - record what I say, and we'll see if prices do indeed fall."
He continued, "This government headed by Netanyahu has set up a housing cabinet that did not exist in previous years. I gave up my place as head of the housing cabinet in favor of Yair Lapid and indeed the cabinet functioned in terms of making decisions - not all of them satisfactory and good, but there were some important decisions. The housing operations headquarters was set up, and there is less ego and more cooperation, and the results speak for themselves, and we are improving, and marketing is growing more and more."
Kahlon will cause chaos
Ariel said that if Moshe Kahlon implements the housing plan he has presented, which revolves around scrapping the Israel Land Authority (ILA), then "there will be chaos." He said, "Kahlon's ideas verge on dreams …. He wants to take away the ILA's authority - that won't happen because at least 15 laws must be enacted for that to happen. Somebody might think that it will cause prices to fall in 2015 but I don't think so. If that happens, then home prices won't fall this year."
Regarding accusations that he is allocating too many resources to building over the green line, Ariel said, "We marketed only 4% in Judea and Samaria, which I so much support. Does that influence the entire market? No. All this talk of transferring funds to the settlements instead of the budget for transferring army bases to the Negev is nonsense. Moving the IDF bases to the south is a NIS 30 billion project over eight years, and it is an example of cooperation between us and the Prime Minister's Office. We are proceeding according to the agenda that we set and we will soon take a decision about how many apartments will be planned there in 2015."
At the conclusion of his speech, Ariel gave out his mobile phone number - 050 7241680 - to show how accessible he is to citizen's questions. However, he asked that questions be texted because he would not have time to speak to everybody.
Published by Globes [online], Israel business news - www.globes-online.com - on February 23, 2015
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