Cost of housing continues to rise, data shows

Overall, the CPI increased by 0.4% in July, mostly pulled up by fruit and vegetable prices, according to Alumot Investment house.

By
August 16, 2016 17:55
1 minute read.
Construction (illustrative).

Construction (illustrative).. (photo credit: REUTERS)

Five years after massive street protests decried the high cost of housing, prices continue to increase, according to new data released Tuesday.

The quarterly report from the government appraiser in the Justice Ministry showed a 2.5 percent increase in the second quarter, bringing overall increases for the year to 8%.

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In relation to last year, only one of 16 areas saw declines in housing prices: Jerusalem, where prices fell 3%. In Tel Aviv and Ashkelon, prices were up 13%, while prices rose 10% in Herzliya and 3% in Haifa. In the second quarter alone, prices did not fall anywhere but remained even in Rehovot and Haifa.

The figures also found that an average, four-room apartment cost NIS 3.09 million, which was 13% more expensive than a year earlier.

Tal Alderotti, the chief government appraiser, said the housing supply of unsold new units had increased, reaching 28,000.

Aside from the appraiser, there was also Consumer Price Index data showing that housing costs rose.

Overall, the CPI increased by 0.4% in July, mostly pulled up by fruit and vegetable prices, according to Alumot Investment house.

“The central surprised was from the housing section, which returned to price increases after being weak for several months,” an Alumot evaluation noted.

Finance Minister Moshe Kahlon has struggled to turn the tide on housing prices, even going so far as to warn that the market is a bubble, in hopes of chasing away investors and immediate buyers.

His new budget plan includes, among other things, a tax on third apartments, which he hopes will encourage owners of multiple homes to put units back on the market.

The measure has been criticized over the possibility that it will remove supply from the rental market, causing rent prices to increase even as it has more salutary effects on the cost of buying a home.


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