The Ministry of Housing and Construction suspects that 650 contractors have broken the Sales (Housing) Law (5733-1973), by not reporting the sale of about 3,000 apartments. Fines could reach NIS 75 million.
The Ministry of Housing said that there are more than 1,500 contractors in Israel who have sold at least one apartment. The Sales (Housing) Law does not apply to buyers groups, and they are not included in the ministry's survey.
The ministry said, "A hearing is underway for the companies under suspicion. If the suspicions are verified, financial sanctions will be levied in the amount of NIS 25,000 for each violation, in other words for each apartment whose sale was not reported."
In the wake of the collapse of Heftsiba in August 2007, the Sales (Housing) Law was amended to impose consumer protection requirements on contractors to protect homebuyers' money. The amendment's provisions include that the contractor will notify the regulator, immediately following the signing of a sale contract, details of the sale: name of the buyer and the seller, the lot and section, the guarantor and type of guarantee to the buyer.
The law also stipulates a fine of NIS 25,000 for each violation.
Minister of Housing and Construction Ariel Atias said, "The law aims to protect the money of homebuyers. The consumer importance, especially in view of the lessons of the Heftsiba collapse, is essential for protecting buyers' money. Most apartment sellers obey the law, and report every sale as mandated and give the guarantees required. The companies that do not report first and foremost hurt the buyers, and it is my duty to use the appropriate tools to protect the buyers' money."
Published by Globes [online], Israel business news - www.globes-online.com - on March 3, 2010
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