The plethora of plans that have come and gone over the past year concerning the reduction of housing prices have not succeeded in lowering housing costs, a poll suggests, but in confusing potential home buyers – to the extent that they are actually ready to pay more for a home of their own. The poll, by business newspaper Globes and the Azimuth investment house, shows that on average Israelis looking for a home are ready to shell out NIS 1.31 million ($332,000) to buy one, an increase of NIS 2,000 over the last poll six months ago.
Compared to the poll taken one year ago by the groups, the amount Israelis are willing to pay is up close to NIS 10,000. However, it was still less than the NIS 1.5 million buyers said they were ready to part with in 2013, meaning, the pollsters said, that the market is beginning to stabilize.
One striking difference between this edition of the poll and previous ones is that the NIS 1.31 million is an amount homebuyers are actually willing to commit to, practically rather than just theoretically. According to the poll, 10.5 percent of Israelis said they were strongly considering buying a home right now, and 8.2 percent said they were actively looking for one. Six months ago, those figures were 7.2 percent and 3.6 percent, respectively.
What that suggests, said the pollsters, is that Israelis have given up on the plans the government has devised to lower housing prices. After the zero-VAT plan of 2014 proposed by former Finance Minister Yair Lapid fizzled out, current minister Moshe Kachlon had proposed the “Buyer’s Price” (Mechir Lamishtaken) program, in which contractors bid for land parcels by guaranteeing the lowest price per square meter on apartments. In return, the contractors get the parcels for a heavily discounted price, and can build other, higher standard homes, which they can sell on the open market.
While the construction of thousands of apartments in the “Buyer’s Price” program is said to be imminent, homebuyers are apparently not willing to wait to see how it pans out – so prices on the open market continue to climb.