Housing Market Slump Continues

An 18 percent fall in housing purchases from April to May was reported by the Ministry of Finance on Sunday.

The general number of deals fell from 11,000 in March to 9,000 in April-May 2016, an 18 percent decrease. A comparison with April-May 2015 also showed a 5 percent drop in the number of deals.

There was a drop of 20 percent in new housing buys, versus only a 14 percent fall in sales of secondhand housing.

The Ministry of Finance noted that only in May 2011, during the social protest, and in May 2014, during the wait for the ill-fated 0 percent VAT plan, was the number of secondhand housing deals lower.

The reason for the bleak numbers was not clear.

“One of the explanations for this low level of secondhand housing deals could be the sharp drop in purchases by investors, whose main activity in most areas was in the secondhand housing segment,” the survey stated.

Meanwhile, in some places the market appeared to be thriving.

Shikun & Binui Holdings sold 46 apartments in the Yad Eliyahu neighborhood in south Tel Aviv within three-quarters of an hour on Friday, Globes said.

The project comprises two apartment buildings in Yiftah Street due to undergo renovation under National Outline Plan 38a (Tama 38a) for reinforcing buildings to withstand earthquakes and adding two-and-a-half floors. After the renovation, there will be 57 apartments.

Most of the apartments in the project have five rooms and a balcony. Prices for the smallest five-room apartments in the project started at 2.4 million shekels. Due to high demand, the company sold the apartments at a special sales event that used a lottery drawing.