Luxury Real Estate in the Holy land of Israel

Categories: Buying Property Guest Post

 

luxury real estate in isrealIsraeli real estate has been amongst the best performing in the world over the last few years. Supported by accommodative monetary policy, a stable banking system with little or no exposure to the sub-prime crisis that decimated the U.S. property market, strong demand from both locals and foreigners, as well as a limited supply; after all, Israel is smaller than New Jersey with a vast swathe in the south desert, and you have a potent cocktail for rising prices.
A tightening of monetary policy beginning in mid-2009 that saw the Bank of Israel prime rate rise from 2% and peaking in September 2011 has started to reverse with the rate currently standing at 2.25%. During the stages of the tightening phase, the higher interest rate coupled with restrictions on bank lending to home buyers did begin to impact the residential property market. There was one segment of the property market that did not flinch – the luxury real estate market.
The luxury real estate market in Israel is comprised of housing located primarily in the central and north eastern areas of Herzliya Pituach, Savyon, and Caesaria, and exclusive areas of Jerusalem in the east. There are smaller pockets of luxury housing primarily located on the coast such as Arsuf and Michmoret.
The luxury apartment market is concentrated predominantly in Tel Aviv. Apartments with a sea view or preferably within walking distance of the beach. A new dual apartment/rental project is also currently under development in Herzliya Pituach. The luxury apartments Tel Aviv has to offer are often located in close proximity to the holy sites such as the Western Wall.
In the last few years, many of Israel’s upwardly mobile have actually sold their houses in the luxury areas and moved to a luxury apartment in Tel Aviv to be closer to the action. This trend is continuing and there are a number of luxury projects in differing stages of development in Tel Aviv.
Local buyers for Israeli luxury real estate is limited given the relatively small population (approximately 6.5 million Jews) and the tiny percentage of this population with the wherewithal to afford luxury accommodation. However, there is an abundance of foreign buyers from France, the U.S., U.K., Australia, and even a few Russian oligarchs with the funds for a second or first home in Israel.
Israel’s hot summers and mild winters, beach and coffee house culture, fine dining, cosmopolitan lifestyle, and historical sites make it the perfect place for those with the means to buy a luxury apartment. Just make sure to consult with a real estate professional before taking the plunge.

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