'Israel has third-fastest growing home prices in world'

Global Property Guide says Israel ranks behind only Hong Kong and Singapore.

By GLOBES CORRESPONDENT

MAY 29, 2011 22:37

311_real estate (photo credit: Uriel Messa) — 311_real estate

(photo credit: Uriel Messa)

Israel had the third-fastest growing home prices in the world in the first quarter of 2011, ranking behind only Hong Kong and Singapore, according to Global Property Guide.

Home prices in Israel in the first quarter of 2011 were 7.81 percent higher in inflationadjusted figures and 12.31% higher in nominal figures than in the corresponding quarter of 2010, the guide said. However, the pace of home prices slowed markedly compared with the preceding year: home prices rose 15.66% in inflation-adjusted terms between the first quarter of 2009 and the first quarter of 2010, and rose by 19.71% in nominal terms.

Israeli home prices rose 1% in inflation-adjusted figures in the first quarter of 2011 over the preceding quarter, and rose 1.78% in nominal figures.

Meanwhile the Central Bureau of Statistics reported Sunday that 1,703 new homes were sold in April 2010, 20% fewer than in March, due to the Passover holiday. Demand for new homes totaled 2,939 in April (including homes for sale and homes not for sale), up from 2,834 homes in April 2010. 11,018 homes were available for sale at the end of April, the lowest figure since the beginning of the year. New home sales were 18% higher in January-April than in the corresponding months of 2010.

Inventory of new homes has exceeded the 11,000 threshold since January, its highest level since the 11,046 available housing units March 2009.

The housing inventory fell by an average of 0.5% per month in January-April. 4,531 of the new homes available for sale were in the Central District, 2,049 were in the Tel Aviv District, 1,568 were in the Southern District, and 1,537 were in the Jerusalem District. The housing inventory is sufficient for 8.9 months at the current rate of sales.

Also Sunday, IDF Radio reported that OECD Secretary General Angel Gurria has praised the Israeli economy, saying that the body for developed economies is “following the rise in real estate prices” and that “the steps taken by the Bank of Israel and the Israeli Government will be effective and will help moderate prices.”

Regarding the possible candidacy of Bank of Israel Governor Stanley Fischer for the position of head of the International Monetary Fund, Gurria said, “I have expressed my opinion many times – it is crystal clear that Fischer is suitable for the position. I have nominated him in the past. Today he is not a candidate and it will remain as such unless he and the Government decide otherwise.”

Speaking about peace in the region, Gurria said, “It is clear that stability in the region will stimulate the Israeli economy.”

He added that unemployment is the most worrisome challenge to the world economy today and if it improves then the situation will seem much better.