Home purchases by foreign residents surge

Purchases of Israeli homes by foreign residents surged in January, particularly in Netanya, Jerusalem and Beersheba, following the terrorist attacks against Jews in Paris, according to figures published Sunday by the Finance Ministry. The rise comes after purchases of Israeli homes by foreign residents hit an 11-year low in 2014. The proportion of investors in total home-buying deals rose to an exceptional 30 percent in January, significantly higher than the average proportion since taxes on investors were raised in 2011. The Finance Ministry said the increase in foreign investors in Netanya “is partly attributable to an increase in the proportion of foreign residents,” although it added that foreign residents are responsible for about one-quarter of the rise in purchasers by investors. The survey, signed by Finance Ministry chief economist Yoel Naveh, said 11,000 housing units were purchased in January, a moderate 5% less than in the preceding month. The decline in the number of deals followed a steep rise in the November-December period with the withdrawal of the 0%-VAT proposal. The Finance Ministry said housing purchases by young couples, who led the rise in the number of deals in November-December, were down 13% in January. Nevertheless, it is still a relatively high 4,000 purchases in a month, which is in the upper range of monthly housing purchases by young couples in recent years. Deals by home owners seeking better accommodations were down 17% in January, while real-estate investors increased the number of their deals by 33% compared with the preceding month.