The government on Sunday announced a new program for the housing market, but, after months of promises Major New InitiativesIts bundle of measures continues in the same direction as its previous efforts.
The joint announcement by the ministries of finance, interior and construction promised 70,000 new housing launches each over the next four years. this number is the same plans announced last fall, Which failed to stop the rising prices. Recent data has shown that housing prices An increase of 16 percent over the previous yearThe highest figure in a decade, with a sharp increase in parts of the country’s center.
Record breaking last year 63,000 houses Ground broke, but the Israel Builders Association suggests that around 100,000 housing needs to be commissioned annually to meet growing demand.
This year, the government has said, around 30,000 houses will be made available through Discounted “Target Price” Program,
To help deliver on the promised numbers, the ministries involved said they would issue plan approvals for 125,000 homes every year, as well as 75,000 tenders for housing units on state-owned land and 45,000 for Successful construction will issue tenders.
But to achieve anything close to 70,000 new housing starts, there has to be faster processing and less bureaucracy around the construction approval process. Earlier in the year, the plans were announced Streamlining decision making for business properties, there are There are some indications that faster decisions may be made There are many delays on residential projects, but at the local level. Recognizing the potential blockage, ministers are now promising to help increase municipal engineering departments to accelerate the rate of construction decision-making in local areas.
The government has also announced that it will support the development of two modular construction plants to rapidly deliver the prefab-style building that is changing the way other rapidly growing populations. It would also subsidize international transportation costs for these types of early buildings. modular construction market growing fast And Israeli-led businesses like VivoWhich maintains R&D in Tel Aviv but builds it in the United States, is a leading innovator in this field.
There were announcements regarding the target price discounted apartment program Welcoming by Minister Zeev Elkin last week, Now the joint ministries have confirmed that the winners in the housing lottery (which have already been oversubscribed) can expect higher discounts of up to NIS 500,000 ($148,994) with an additional NIS 40,000 ($12,000) for those shopping outside the central cities.
Efforts will be made to increase the number of affordable homes available in the center of the country to about 10,000 units. This expansion comes with the promise that about 80% of these additional homes will be allocated to those who are eligible for some form of supported housing. The government also says it intends to encourage large-scale sheltered housing complexes.
Going forward, the Area Housing Lottery will give priority to people classified as local people. The amount of time required to live in an area to qualify for this status would range from 18 months in rural and less demanding areas to three years in the most popular parts of the country.
Some provisions already exist to give preference to local people in the lottery, but now the proportion of houses allotted to such residents will increase to at least 35% in all areas and 40% in projects or locations that the government chooses. to prioritize.
The government also plans to manage the final price of homes purchased under the target price scheme. Its proposed approach is to ensure that ever-increasing construction index Strictly applicable only to construction costs, excluding the land component and contractors’ profit margin, which also contribute to the overall apartment cost, and denying developers the option of passing their legal fees to the buyer.
Distributing it required a change in the 1973 sales law. The amendment has already been approved by the Israel Land Authority and will be applied to contracts within the lottery process. But for it to be widely implemented, it would have to go through the Knesset Finance Committee before returning for the second and third readings in the plenum.
Meanwhile, the agreement mentioned in january Will try to encourage them to increase housing construction (2,500 permits each over the next four years) with regional authorities. Municipalities will also receive grants to help pay for public buildings and other infrastructure to support development.
All these announcements are primarily focused on the homebuying market. sole reference to About 30% of the population who rent Homes announced this week are a promise of plans to amend the rules to encourage local authorities to use urban and industrial areas to build more rental housing. Officially Up With Rent about 10% In the first few months of 2022, and indeed much more in some regions such as Tel Aviv, this significant proportion of the housing market is suffering.
Finance Minister Avigdor Lieberman has argued that “the plan we presented today is comprehensive and addresses failures in the housing market.”
Construction and Housing Minister Zeev Elkin clarified his focus: “We promised to leave no stone unturned to bring solutions for young couples and prioritize apartment buyers over contractors, and we are.”
But recognizing the plan’s limitations, he promised more measures soon to “stabilize the real estate market in Israel”.
Interior Minister Aylette Sheik said: “We continue to work hard and fight the housing crisis … this is my biggest job in office and despite the political instability we are not taking our feet off for a moment.” “
Those who study the housing market and campaign against its inequalities believe that more than any other sector, it requires stable government and sustained attention, which Israel is sorely lacking. Is.
Gil Gan Mor, head of the social and civil rights unit at the Association for Civil Rights in Israel, said: “In housing, you need a good sustained policy, and political disruption works against that. Coalition crisis after coalition crisis. Also, there is no focus or capacity to meet the need of the country.”
