Israel’s real estate market is entering a new stage in 2025. After the war, housing prices softened in some areas, sales volumes dropped to multi-year lows, and rental demand increased. Yet the fundamentals of the sector remain the same. Land is limited, the population continues to grow, and demand for housing is steady. For investors, especially those abroad, this creates both challenges and opportunities.
Market Snapshot
- Home prices: In the second quarter of 2025, the average price of an owner occupied dwelling was about ILS 2.27 million, or around USD 670,000. That represented a small decline of two to three percent compared to the year before.
- Sales volume: In June 2025, fewer than 6,000 homes were sold, one of the lowest monthly figures in twenty years. New construction sales fell by almost half compared to the same month a year earlier.
- Mortgages: Israeli citizens buying their first home can usually receive up to 75 percent financing. Foreign buyers are generally limited to 50 to 60 percent, which requires larger down payments and stricter documentation.
These figures reflect a market under pressure, but also one where well-prepared buyers may find openings. With fewer transactions taking place, there is more room to negotiate. Rising rental demand in Tel Aviv, Jerusalem, and Haifa also provides a strong base for long term returns.
The Role of Currency
All property transactions in Israel are priced in shekels. Buyers who bring dollars or other foreign currencies must convert them at the time of purchase. In 2024- 2025, the exchange rate has ranged from the low 3.3s to the upper 3.8s. A shift of only a few points can add or reduce several percent of the effective purchase price. For American investors, timing transfers or arranging structured payments can make a significant difference in cost.
Challenges for Foreign Investors
Foreign buyers face several hurdles when entering the Israeli market:
- Local legal rules require lawyers to verify ownership rights, zoning, and building permits.
- Financing for non-residents is capped at lower levels than for Israeli citizens.
- Standard contracts often require a deposit of seven to ten percent at signing.
- Purchase taxes for non-residents are higher than for local buyers.
- Property management is essential for those who want to rent out their homes.
Without reliable professional help, these steps can discourage or delay investors.
Genesis Estates: A Bi-National Solution for Real Estate in Israel
Genesis Estates has built its reputation as a partner for both Israeli and American clients. The company combines experience in the Israeli real estate market with knowledge of the American investment landscape, supported through its association with CashMatch. Its team of professionals includes mortgage advisors, real estate lawyers, property managers, and market analysts from both countries.
- Experience in both markets: Genesis understands American investor standards and how to apply them in Israeli transactions.
- Mortgage and legal guidance: The firm works with leading banks and attorneys to help foreign buyers secure financing, prepare contracts, and complete purchases with confidence.
- Community investment models: Genesis enables families and diaspora groups to pool resources, purchase property together, and generate shared rental income.
- Comprehensive service: From identifying suitable properties to handling financing, contracts, and management, Genesis offers end-to-end support.
- Access to builders and presale deals: Through its network of Israeli contractors and developers, Genesis provides clients with opportunities to purchase in new projects at the presale stage, often at favorable terms not widely available on the open market.
- Risk management: The company also helps investors manage exposure to currency movements and build protective clauses into contracts.
Conclusion
Israel’s real estate sector is moving from recovery toward growth. Prices are slightly lower, transaction volumes remain subdued, and mortgage rules are complex. These conditions create a rare opening for disciplined investors. For foreign buyers, the key is finding a trusted partner.
Genesis Estates offers that bridge. With expertise in both the Israeli and American markets, a professional team across two countries, and the ability to guide investors from the first meeting to long-term property management, the company provides a clear path into one of the most resilient real estate markets in the world.
This article was written in cooperation with Estrategy