New ‘Villa’ Remodeling Law Will Ease Rent Levels, Officials Hope

The Ministerial Law Committee on Sunday authorized for legislation a law that would allow the owners of one-family houses (“villas”) to remodel and break up their homes into two or three apartments, depending on size. According to MK Eli Cohen (Kulanu), who authored the legislation, the new law would greatly increase the supply of apartments for rent in Israel, thus positively impacting on rent levels.

While there are many basement apartments in Israel – separate units which homeowners rent out to tenants – the vast majority of them are illegal, meaning that their owners are not authorized to rent them out, and that they cannot be coded properly for electricity, gas, etc. The proposal by Cohen is no less an important change for them than it is for young couples seeking cheap housing.

Under the proposal, homeowners with houses measuring over 120 meters in area will be able to split their homes into units of at least 60 meters each. Each unit will need to have their own kitchen, bathroom, and entrance.

Under the law, approval by local planning boards will be on a fast-track basis. Many homeowners who have tried this process in the past have met with opposition from those boards, who claim that the resulting apartments are “low quality,” result in crowded streets because more cars would be seeking parking spaces, and would reduce real estate values. Under the new law, homeowners could bypass local planning councils and receive permits from special national committees to be set up specifically for the purpose of approving such changes.

“The large number of young couples who enter the housing market each year, coupled with the high cost of living and the limited number of apartments available to these new couples, requires us to do whatever is possible to increase supply,” said Cohen. According to government statistics, the cost of rent on average in Israel shot up by some 60 percent over the past five years – and the new law, said Cohen, will hopefully drive that price level back down.