Real estate market is heating up: Apartment Prices in Israel Experience First Increase in 10 Months

After a prolonged period of stagnation, apartment prices in Israel saw a notable uptick towards the end of 2023, marking the first increase in ten months. According to the latest data from the Central Bureau of Statistics (CBS), the housing price index revealed a 0.7% rise in apartment prices during the months of November and December 2023 compared to the previous two months.

Despite a surplus of unsold new apartments, the news of rising prices persisted, with a 0.9% increase observed during the same period. This surge in prices was reflected in the average cost of an apartment across Israel, climbing by 2.3% in the fourth quarter of 2023 compared to the third quarter, reaching NIS 2.153 million by the year's end. Moreover, compared to the corresponding quarter of the previous year, the average price witnessed a significant 3.7% increase.

Analyzing the CBS data, it was revealed that Tel Aviv maintained its position as the most expensive city for apartments, with an average price of NIS 3.905 million. Following closely were Herzliya, Ramat Gan, Jerusalem, and Kfar Saba, with average prices ranging from NIS 2.822 million to NIS 3.584 million.

While some cities experienced substantial increases in average prices, others saw declines. Ramat Gan, Petah Tikva, Beit Shemesh, and Be'er Sheva recorded notable increases, while Rishon Lezion, Bat Yam, Holon, and Kfar Saba witnessed decreases in average prices.

For prospective buyers seeking more affordable options, the data highlighted that apartments below a million shekels were primarily limited to small 1-2 room units in select cities such as Netanya, Rehovot, Ashkelon, Haifa, and Be'er Sheva.

This resurgence in apartment prices signals a potential shift in the Israeli real estate market, prompting both challenges and opportunities for buyers and sellers alike.