Apartment sales increased 19% in February despite ongoing Gaza war, new figures show

Housing market records 7,511 sales in month, led by new homes sold by contractors on the free market offering special deals, Finance Ministry report shows

Sharon Wrobel is a tech reporter for The Times of Israel.

A construction site in the West Bank settlement of Ma'ale Adumim on February 29, 2024. (Menahem Kahana/AFP)
A construction site in the West Bank settlement of Ma'ale Adumim on February 29, 2024. (Menahem Kahana/AFP)

Israel’s housing market is showing signs of a recovery for a second month after taking a hit at the end of 2023, amid the ongoing war with the Hamas terror group.

The number of apartments sold in February rose 19 percent year-on-year, with 7,511 transactions recorded, but deal figures were still down 7% compared with January, according to the monthly real estate report by the Finance Ministry’s chief economist released on Thursday.

“A historic multi-year comparison of the number of home sales on the free market during the month of February beginning in 2000 showed that this February, figures were at the lower end, which is mainly due to a low level of secondhand transactions.” the Finance Ministry’s chief economist Shmuel Abramzon said in the report.

Transactions for secondhand residential units in February rose by a moderate 2% to 3,867 apartments, year-on-year, but were down 11% compared to the previous month.

What stood out in February were the sales of new homes by development and building companies, which amounted to 3,644, marking a sharp increase of 44% versus the same month last year, and a moderate decline of 2% from January.

Excluding government-subsidized apartment sales, 2,702 homes were sold on the free market, up 34% year-on-year. The level was the fourth-highest recorded during the month of February over the past 23 years.

Palestinian laborers work at a construction site in Ma’ale Adumim, in the West Bank, on February 29, 2024. (Menahem Kahana/AFP)

Abramzon attributed attractive financing conditions that contractors are offering to buyers as one of the main reasons for the recovery and sharp growth in sales. The central region led the sales of real estate developers on the open market. The second-largest increase in sales on the free market was recorded in the area of Beersheba with 431 apartments.

Sales of about 80 homes were recorded in Netivot, situated only 11 kilometers (seven miles) from the Gaza border, and 72 apartments were sold in Ofakim, a southern city where Hamas gunmen had killed 40 people on October 7. In Netivot, first-time homebuyers made up 43% of all sales in the southern city.

The war broke out on October 7, when Hamas led an onslaught in which terrorists from Gaza killed about 1,200 people in Israel, a majority of them civilians, including children and the elderly, and abducted more than 250 people under a deluge of rocket fire aimed at population centers all over Israel.

Back in December, the number of homes acquired — 6,088 — was 15% lower than a year earlier, a figure representing the lowest number of homes purchased in that month in over two decades.

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