The index fell a further 0.3% in August
Mishkan Hapoalim Mortgage Bank Homebuyers Index fell a further 0.3% in August 2011 to 125.4 points, its lowest level since June 2003, indicating that the condition of homebuyers continues to worsen, due to rising home prices and interest rates.
The Central Bureau of Statistics reports that home prices rose a further 0.4% in August, and rose by 12.3% in nominal figures and 8.2% in real figures over the preceding 12 months. Home prices have risen 64.8% in nominal terms and 41.3% in real terms since the low point in 2007. The Bank of Israel reports that the average mortgage interest rate on fixed and CPI-linked 17 20-year loans rose a further 0.16% in May to 3.55%.
The drop in the unemployment rate to 5.4% and the rise in the average national salary partly offset these home prices and mortgage interest rate factors in the Mishkan Index.
The sharp drop in purchases of homes and the consequent increase in the supply, together with the slowing pace of the increase in prices all suggest that the market has entered a wait-and-see pattern.
Published by Globes [online], Israel business news - www.globes-online.com - on October 5, 2011
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