Steinitz: Previous gov't to blame for lag in housing reform

Finance minister says gov't working to ease Israel Lands Administration bureaucracy, says reforms could pass Knesset this week.

July 21, 2011 11:56
2 minute read.

Finance Minister Yuval Steinitz 311. (photo credit: Courtesy: Ministry of Finance spokesperson)


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The government is not surprised by rent protests that have sprung up around the country in the form of tent cities and street rallies, Finance Minister Yuval Steinitz told Israel Radio on Thursday, blaming the previous government for the housing delay that, according to the finance minister, is "eight years" behind.

As protesters in Tel Aviv invited tent-city activists from around the country for a culminating rally in Bima Square in the central part of the city, Steinitz stressed that the government is working to open up land for construction around the country, and reform the Israel Lands Authority (ILA).

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Rent protesters leave tents, take to Tel Aviv streets
Right wing group pulls out of Tel Aviv tent protest
Rent revolt hits Jerusalem

The finance minister said "I assume that within the week we will advance these new measures," blaming the previous government for shortcomings in housing reform.

Meanwhile, a Jerusalem Institute for Market Studies report pointed out that Israeli homeowners paid 75 percent more than the OECD average for apartments in Israel, with real estate tax representing 9.4% of all taxes in Israel, as compared with only 5.4% in OECD countries.

While this higher percentage highlights growing frustration Israelis have expressed over the high price one must pay to purchase an apartment or property, the government's current focus is on the bureaucratic process that has prevented perhaps a necessary boost in construction.

Prime Minister Binyamin Netanyahu has called the bureaucracies for obtaining permits and beginning construction as "insane," and some of the research completed by the Jerusalem institute indeed points to more bureaucratic steps and legal issues contractors face in order to build.

According to the survey, Israeli contractors can face up to 20 steps before they can begin construction, taking as long as 235 days, whereas the OECD average is 16 steps over 166 days.

The government is planning to try and pass reform that would streamline the bureaucratic process at the ILA in order begin construction on a lack of between 80,000 to 100,000 housing units.

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