World Bank says West Bank land prices rocketing

Prime downtown commercial plots in Ramallah has doubled each year since 2005.

By JERUSALEM POST STAFF
Ramallah 224.88 (photo credit: AP)
Ramallah 224.88
(photo credit: AP)
The price of property in the West Bank is rocketing beyond the reach of most local businesses and home buyers, pushed up by a weak dollar and Israeli control of large chunks of the territory, a World Bank report said Thursday. The 41-page paper said local government data from the commercial and political center of Ramallah indicates the value of prime downtown commercial plots has doubled each year since 2005, hitting the current average of about $372 a square foot. Israel, citing the need to prevent Palestinian attacks inside Israel and on Jewish settlers in the West Bank, has kept large swaths of Palestinian land and roads off limits to Palestinians. It also maintains a complex network of checkpoints on roads that remain open to West Bankers. That leaves the vast majority of Palestinians chasing land in the remaining 41 percent of the territory, which is home to at least 90 percent of the population, the World Bank said. "As a result, land prices are shooting up and in certain towns are becoming prohibitive for all but high value commercial activities, or high rise apartment buildings," the report said. "Residential development is crowding out other economic activities on scarce plots available for development, yet there remains a housing shortage." The report does not cover the Gaza Strip, which Israel evacuated in 2005 and largely sealed off after Hamas seized power there in 2007. In addition to the Israeli squeeze on the West Bank, the World Bank said, property prices in the territory are being nudged up by the many Palestinians living abroad and sending money home, some of it slated for investment. "The real value of domestic cash savings, usually in US dollars or Jordanian dinars, are threatened by the falling dollar, creating pressure to convert these cash savings into stable investments," the report said. "With few profitable options in the productive sectors, much capital is invested in land, putting added pressure on prices." The World Bank report concludes little can be done to increase the stock of land available until the Israelis and Palestinians end their conflict. "Ultimately, the restrictions on access to land (under Israeli control) will only be resolved with the final resolution of the peace process and the end of the occupation," it said. The renewal of Israeli-Palestinian peace talks at a US-hosted conference last November was supposed to produce a final peace deal by the end of 2008, but the sides acknowledge that target is unreachable. With Israel in the throes of forming a new government and the US presidential election in two weeks, change seems unlikely anytime soon.