The tightening of mortgage terms initiated by Supervisor of Banks Rony Hizkiyahu is having its effect on the market. Demand and sales of new homes plummeted in June immediately afterwards, the Central Bureau of Statistics reported today.
Even though the new mortgage rules only came into effect in July, it is generally believed that the banks did not wait for the official start, and began applying the new rules in June.
Demand for new homes fell 25% to 2,535 apartments in June from a month earlier, and new home sales fell 27% to 1,511 apartments.
On the supply side, the housing inventory fell another 3.6% to 9,261 apartments, but the plunge in demand increased the inventory to 7.9 months of supply at the current rate, the highest level since March 2009.
Published by Globes [online], Israel business news - www.globes-online.com - on July 29, 2010
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