First week of November: The Tel Aviv Real Estate Market
Although technically we’re deep in the fall season, the weather here in Tel Aviv allows us Tel Avivians to still hang out on the beach and enjoy the sun. After a super hot summer, it is expected of the real estate market to have cooled down a bit however, quite the opposite is happening.
Prices are steady, inquiries are still coming in at a high rate and the high-end market seems to have caught the attention of most home buyers now days.
During last year’s demonstrations, most home buyers have decided to give the market time to cool down in hope for a major price fall; when home buyers have realized that not only is the market not cooling down but heating up, they all came storming in purchasing at top end prices. When the average prices of prime location apartments across Tel Aviv have crossed the 10,000 USD p/sqm mark, creating a new understanding of where the Tel Aviv real estate market is heading towards, many home buyers have decided this year not to fall for any rumors or speculations and just go ahead in pursuing their dream.
One of the main real estate agendas covering up every news headline is the fact that a 1/3 of apartments purchased in Israel and in Tel Aviv in particular are considered investment purposes, thus creating this “bubble”. But when looking at investing, then the options here are clear – letting your money just sit in the bank won’t give you much ROI, and with an almost free mortgage interest rate, investing in real estate just seems to be the better option.
Over the past 4 years, the Tel Aviv real estate market has been growing stronger due to the basic laws of supply and demand, and this can also be seen in the rental market. With the average 2 BR apartment in Central Tel Aviv going off for 7,000 NIS a month, setting up a new record in the local rental scene, I can’t help but wonder is the real estate market reaching a new era? Or is this all just about to burst in our face like a giant bubble?
Only time can tell. But as long as Israeli Bank Governor continues to reduce mortgage interest rates and home buyers from all over the world flocking to buy a piece of the White City, the local market will remain strong and true.