Knesset special session to focus on housing market crisis

Other topics to be addressed include interest rates, Nablus shooting and doctors’ demands.

By REBECCA ANNA STOIL
April 27, 2011 03:58
3 minute read.
Shas MK Yitzhak Vaknin

Yitzhak Vaknin 311. (photo credit: Ariel Jerozolimski)

As reports circulated that Bank of Israel Governor Stanley Fischer was planning additional restrictions on mortgages, the Knesset was set to meet Wednesday to discuss the current crisis in the housing market, as well as other pressing issues in a special recess session.

Yitzhak Vaknin (Shas) gathered the signatures of 24 fellow MKs to call the Knesset into session only two days after Pessah, almost three weeks before the Knesset is scheduled to reconvene for its summer session.

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Vaknin requested that the plenum meet to discuss the housing crisis, as well as rising interest rates, which have hiked the monthly payments for many mortgage-holders.

On Tuesday, financial sources reported that lenders could be restricted to offering regular rates for mortgage-holders who borrow up to 40-50 percent of the total price of the property, but borrowers seeking funds beyond that 40%-50% rate would face significantly higher interest rates.

The Bank of Israel is expected to make an official announcement regarding mortgage rates as early as next week.

The head of the Knesset Housing Caucus, Miri Regev (Likud), said Tuesday that she did not believe that such solutions were the correct remedy for the current rise in housing prices.

Regev, who was not one of the MKs who signed on to the petition for Wednesday’s special session, offered a number of alternative solutions to the current housing situation. She proposed that that 20% of the apartments in each new project be reserved for young families at affordable rates of NIS 600,000 to NIS 700,000.

“As long as the Israel Lands Authority and the other responsible bodies don’t reduce land prices for young couples in the periphery and in national priority areas, the prices will continue to run out of control,” complained Regev.

She called on the state to quickly clear the way for the construction of tens of thousands of units.

“There is no reason that our children who serve in the army and do national service can’t afford a house, while children of the very wealthy alone can have their parents subsidize their real estate purchases,” she said.

Regev has also proposed a bill that would allow an exemption from Value Added Tax for first-time home buyers, a proposal that was opposed by the Treasury, which would lose significant revenue under such a plan. VAT applies only to newly built apartments, not to resales.

During the Wednesday session, the Knesset is also expected to discuss this week’s killing of Ben-Yosef Livnat, who was shot by Palestinian policemen while trying to reach Joseph’s Tomb in Nablus.

Aryeh Eldad (National Union) and Ze’ev Elkin (Likud), co-chairs of the Knesset’s Land of Israel Caucus, requested Tuesday that the subject be added to Wednesday’s agenda. The House Committee will meet shortly before the beginning of the 11 a.m.

plenum session to approve the last-minute request.

Kadima also threw its parliamentary weight behind a topic for debate Wednesday, gathering 25 signatures to discuss the ongoing labor dispute between doctors and the Treasury.

Rachel Adatto (Kadima), who is a physician, complained that “the government has ignored the true problems in the public health system and the attempts by the Treasury to create spins around salary gaps will cause doctors to abandon the public system altogether for private practice, will increase the deep crisis surrounding physicians’ salaries and manpower, and will harm the harm the excellence of the health system.”


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