March data on new mortgages Amounted to NIS 22.3 billion - an increase of about 7%

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by Ifi Reporter Category:Real Estate Apr 19, 2021

March data on new mortgages published today (Monday) by the Bank of Israel were another illustration of how hot the residential real estate market is. Amounted to NIS 22.3 billion - an increase of about 7% compared to the corresponding quarter in 2020.
It is one of the strongest quarters in the mortgage market ever in the country. In addition, the volume of mortgages taken in the first quarter of 2021 is 44% higher than the rate of mortgages taken in the corresponding quarter in 2019.

During March, the public took out new mortgages worth about NIS 8.6 billion. This is a slightly lower amount compared to mortgages of NIS 8.67 billion that the public took out in March 2020 - the first month of the spread of the Corona epidemic in Israel. During that month, the public came under pressure and took out mortgages on a very large scale. The share of Bank Mizrahi Tefahot (+ 1.35% 9151), the largest player in the mortgage market in the banking system, rose yesterday by 1.6% to a market value of NIS 23.3 billion. The bank's share is about 3% away from the record price at which it was traded in February before the corona.
The jump in the volume of new mortgages is explained mainly due to a shortage of housing supply and also due to investors' fear that there will be a further increase in housing prices.
Another reason for the jump in the volume of mortgages in recent months is also due to the return to activity of buyers of apartments for investment. This follows a reduction in the purchase tax on investment apartments received in July 2020 by the Minister of Finance, Israel Katz. Recently, the rate of taking out mortgages by those entitled to the price per occupant project was also increased - a flagship project of the previous Minister of Finance, Moshe Kahlon. 
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