Lakeside views

Buyers may find some real estate bargains in Tiberias

A panoramic view of Tiberias on the shores of Lake Kinneret. (photo credit: TIBERIAS MUNICIPALITY)
A panoramic view of Tiberias on the shores of Lake Kinneret.
Tiberias, a town of some 45,000 inhabitants on the central western shore of Lake Kinneret, has seen better days, and the real estate scene there reflects it. While it is both a historic and a religious city, in modern times, that has not influenced the city’s economic development much – a major element when analyzing the real estate situation in a given city.
Tiberias was founded in 20 CE by Herod Antipas, son of Herod the Great. As Herod Antipas was only a “client ruler” of Rome, the city got is name from the reigning emperor, Tiberius.
The city has had its ups and downs, but it has been continuously inhabited since then. It passed from Roman Byzantine rule to Arab rule, and then to the Crusader kingdom. It was reconquered by the Arabs and then by the Ottoman Empire. As such, it is potentially saturated with historic sites, but the Antiquities Authority has not been overly active in the area. The city’s antiquities include the remnants of the Old City walls, as well as a 2,000-yearold Roman theater that was discovered 15 meters below ground near Mount Bernike in the Tiberias hills. Herod Antipas built the theater, which seats 7,000 people.
But despite these historic antecedents, those running the city have not made use of history to attract tourists and generate economic growth.
The same holds true for the city’s religious credentials, at least as far as Judaism is concerned.
Tiberias has been considered a center of Judaism since the middle of the second century CE. When the Romans destroyed Jerusalem and the Temple in 70 CE, the center of Judaism migrated to Tiberias.
It became the seat of the Sanhedrin – the supreme religious body of ancient Israel – and consequently the new capital, the political and religious hub of the Jews in the Holy Land. Furthermore, since the 16th century, it has been considered one of Judaism’s four holy cities, together with Hebron, Safed and Jerusalem. But not much has been made of this potential religious appeal.
Tiberias’ economy is largely based on tourism, but more of these tourists seem to come for the city’s present attractions than for its past. The vast majority are locals who come for a holiday at the shores of the lake, or Christian pilgrims who come to visit the Galilee sites associated with the life of Jesus. There are also the Tiberias hot springs, believed to cure various skin and other ailments.
Tiberias has a small port on the shores of the lake.
Fisherman used this port for thousands of years, but since the 1990s, the importance of the port for fishing has gradually decreased, and today it is mainly used by pleasure craft. The water level in the Kinneret – the country’s major fresh water reservoir – has been decreasing for decades due to a combination of climate change and drought. More water is being pumped out for consumer, industrial and agricultural use than is going in; at present, the lake is six meters below its natural level.
The plan is that desalination plants will increase the amount of fresh water available for domestic consumption, while recycled water will supply the needs of agriculture, and gradually the need to pump water out of the lake will cease, enabling it to regain its original level.
However, if the fall of the Kinneret is not halted, it will have a negative effect on Tiberias’s economy, real estate included, because the lake is the main tourist attraction.
Today, demand for real estate in Tiberias is weak, not only because the city’s economy is relatively weak – according to government statistics, its socioeconomic rating is only four out of 10 – but also because of the real-estate situation in Israel as a whole.
The present municipal administration has been promoting further development of the city: It is planning 6,571 new dwellings, and it is looking to build more hotels and an industrial park. The aim is to fortify the economy, bringing in new blood and more professionals.
Tiberias Mayor Yossi Ben-David says his city is “very welcoming.”
“Because it is relatively small ... newcomers feel at home fast,” he tells Metro. “Tiberias is also a very beautiful city with excellent panoramic views.”
He adds that the city “is an excellent place of residence for English-speakers, whether old-timers or new arrivals. Because of the tourist industry, it has an international ambiance in which English-speakers will be able to find employment.”
Although the real-estate scene is not strong, Shimon Gino, the Re/Max real-estate concessionaire in Tiberias and its surroundings, describes it as satisfactory.
“There is substantial investment demand, because yields are among the highest in Israel. In addition, local residents are upgrading their homes. Consequently prices are creeping up.”
Rentals yield an annual 5 percent to 6% of the price that investors pay for the properties.
From a real estate perspective, Tiberias is divided into three distinct areas: the lower city, middle city and upper city. The least expensive part of town is the upper city, where the new immigrants who came in the ’50s and early ’60s were housed.
The middle city is the most expensive area. Gino tells Metro that a secondhand four-room apartment on the posh Hashomer or Ahad Ha’am streets in the midtown area can cost from NIS 850,000 to NIS 950,000, while an average three-room apartment can cost NIS 650,000.
In the upper city, an average four-room apartment costs around NIS 500,000, while a three-room apartment can cost an average of NIS 400,000.
In the lower city, a four-room apartment can cost NIS 570,000, and a three-room apartment NIS 390,000.
A penthouse in the midtown area can cost NIS 1.5 million on average, compared to NIS 1m. in the lower city.