The Israel Lands Council has approved a rule change sought by its directors – Finance Minister Moshe Kahlon and Housing Minister Yoav Galant – that requires contractors who build homes under the Price Resident program to allocate 5 percent of the homes to public housing. The homes will be distributed for free by the Housing Ministry based on need to families that are on waiting lists for public housing.
Under the Price Resident program, builders are given precedence on allocation of lots for construction if they promise to provide a percentage of homes in a project that will be affordable and set aside for qualified families who do not own homes. The rest of the homes in a project can be sold at market rates, essentially creating a two-tier market – one for the general public, and one for qualifying families, such as young couples, who can buy the lower-priced homes. With the new rule, a third track – free homes for families that are often on public assistance or live in subsidized apartments – is created.
The homes will be paid for by reducing the discount available for families eligible for the Price Resident program. Thus, according to TheMarker, if until now a regularly priced apartment in a project sold for a million shekels and a Price Resident discounted home for NIS 750,000, the NIS 250,000 discount would be reduced by 5 percent, the money going to fund the public housing units.
With the decision, said Kahlon, “we will build an inventory of public housing apartments, part of our philosophy of lowering the cost of housing and reducing the social and economic gaps in Israel. We instituted Price Resident to help young couples, and the new program will help those who need the government’s help in getting a home.”