The Palestinian Authority demanded Thursday that Washington take “serious steps” against Israeli settlement building, and promised an “unprecedented” response, after the Jewish state announced plans to build 1,500 new homes in the West Bank and East Jerusalem.

“It is time for the American administration to take serious steps against what the government of Israel is doing,” Nimr Hammad, an adviser to PA President Mahmoud Abbas, told AFP.

Israeli Housing Minister Uri Ariel invited bids for 1,500 new homes in Jewish settlements in retaliation for the announcement of a new Palestinian government backed by Hamas, his office said earlier Thursday.

Ariel said the move was only the tip of the iceberg and chief Palestinian negotiator Saeb Erekat also said he saw the announcement of the building tenders as a harbinger of more Israeli moves.

“We believe this latest announcement is a clear sign that Israel is moving toward a major escalation, such as new settlement construction, the annexation of occupied territory and forcible transfer,” Erekat said. “In light of the Israeli announcement, we are carefully studying and weighing our response.”

Erekat accused the international community of apathy in acting against the settlements and allowing Israel to become bolder.

“Because the international community has not moved forcefully enough to stop illegal settlement activity, the government led by Prime Minister Netanyahu has reaffirmed its intent to challenge international law and international peace efforts by further colonizing our occupied country,” he said. “This time Israel is using Palestinian national unity, a step welcomed by the international community, as their excuse to continue the colonization of Palestine.”

Erekat called on the global community to increase its boycotts of settlement products as well as to pressure Israel to end its occupation.

Abbas spokesman Nabil Abu Rudeina warned the Palestinians would “respond in an unprecedented way to this step,” but did not elaborate.

“These tenders come at the same time as the world announces is support for the Palestinian unity government. Israel should realize that its settlement policy is unacceptable,” Abu Rudeina said.

Abbas swore in a new merged administration for the West Bank and Gaza with the support of Israel’s Islamist foe Hamas. Israel is boycotting what it calls a “terror government” but both the European Union and the United States have said they will work with it.

Washington has said that persistent settlement expansion by Israel was a major factor in the collapse of US-brokered peace talks earlier this year and on Thursday US envoy to Israel Dan Shapiro condemned the new tenders.

“We oppose settlement construction in the West Bank as well as announcements regarding such construction,” Dan Shapiro told Army Radio. “We would do so with or without this disputed case of a new Palestinian transitional government.”

In Israel as well, the announcement came under attack from some lawmakers within Prime Minister Benjamin Netanyahu’s coalition.

Justice Minister Tzipi Livni, who led Israel’s negotiation team, also attacked the housing announcement as being a policy error and accused Ariel’s pro-settler Jewish Home party of being more of a problem for diplomacy than Hamas.

“This is another diplomatic mistake that will only make it harder to mobilize the world against Hamas,” Livni said in an interview with Army Radio and added that the new construction was “a punishment that the Israel people have received for having the Jewish Home in the government and not because Hamas is in the Palestinian government.”

MK Ofer Shelah (Yesh Atid) also slammed the move, calling it “unnecessary and harmful.”