Residential real estate deals drop a sharp 18% in third quarter

Slide was clear in all regions of country except Jerusalem and Haifa, where transactions dipped more moderately.

Malha neighborhood near Jerusalem 521 (photo credit: Courtesy)
Malha neighborhood near Jerusalem 521
(photo credit: Courtesy)
Residential real estate transactions dropped a sharp 18 percent in the third quarter, the steepest quarterly decline since the last quarter of 2008, according to Finance Ministry data released Monday.
The slide was clear in all regions of the country except Jerusalem and Haifa, where transactions dipped more moderately. In Jerusalem, the moderation was due to an 11% increase in young couples buying homes, while in Haifa it was due largely to investor-driven transactions.
Tel Aviv, on the other hand, led the trend with a 26% decrease in transactions.
Tellingly, the average household wage of the Tel Aviv transactors was NIS 57,000, 2.2 times higher than in the past quarter, indicating that the less well-off largely pulled out of the market in the third quarter.
The sharp drop, however, may have as much to do with unusual circumstances in the second quarter, which saw record levels of real estate transactions.
In Jerusalem, for example, a Jerusalem- area incentives program for firsttime buyers spurned a 40% increase in young couples purchasing apartments in that period. At the same time, levels of investors and previous homeowner purchases in Jerusalem.
In Rehovot, in particular, a trend of young couples putting off home purchases was apparent, with a drop of 42%. The decrease was linked to more stringent mortgage rules published by the Bank of Israel in the last quarter of 2012.