Rental prices fall substantially in large cities

In Jerusalem rents for two-room apartments fell by 11%, averaging $491 a month.

rentals 88 298 (photo credit: Ariel Jerozolimski)
rentals 88 298
(photo credit: Ariel Jerozolimski)
Large cities have seen a significant decline in rental fees for two- and three-room apartments, according to a survey conducted by MADAS, one of Israel's largest on-line second-hand apartment, car and want ad listings, owned by Golden Pages Ltd. According to the survey, demand for apartments in Jerusalem, Haifa and Tel Aviv, which are known as "college towns," fell considerably after the start of the academic year in October, leading to a decline of up to 11 percent in rental fees in December. Most of these apartment renters are young people studying at institutions of higher education, and most of the apartments are leased between August and October. The clearest example is Jerusalem, where rents for two-room apartments fell by 11%, averaging $491 a month, compared with $553 a month in November. Still, the decrease in rental fees for three-room apartments in the capital was only 2%, to an average of $539 a month. A similar trend was recorded in Tel Aviv, mainly in three-room apartments: Such an apartment in the northern part of the city, near Tel Aviv University, was leased in December for $769 a month on average, 8% lower than in the previous month. The cost of leasing a similar apartment in the center of the city fell 3%, to $822 a month. The cost of renting two-room apartments in southern Tel Aviv declined by 2%, to $477 a month, and in central Tel Aviv rents fell in similar fashion, to $687 a month. In contrast, the price of renting a two-room apartment in northern Tel Aviv actually rose in December by 6%, to an average of $713 a month. The survey did not explain the contrasting trends in Tel Aviv. Data obtained were based on rental fees that apartment owners demanded, and not on the rent on which agreement was actually reached. A decline was also recorded in the big cities' suburbs: rents in Ramat Gan and Givatayim dropped 1% to $533 a month for two-room apartments and to $681 a month for three-room apartments. Haifa also reported a lowering of rental prices, where most renters are students attending the Technion's Israel Institute of Technology, the University of Haifa and area colleges. The cost of renting two-room apartments decreased last month by 5% to $324 a month on average; three-room apartments were 1% cheaper, fetching $393 a month. According to the survey, the only exception among the college towns was Beersheba, where rental prices rose, despite the fact that the academic year began about-two-and-a-half months ago. Rents for two-room apartments were up 4%, to an average of $310 a month, while rental prices for three-room apartments rose 1%, to $343 a month, on average.