New index claims home prices higher than reported

The Gazit-Globe Real Estate Institute at the Interdisciplinary Center Herzliya says the price of an average Israeli home is NIS 1.2 million.

A new real estate index by the Gazit-Globe Real Estate Institute at the Interdisciplinary Center Herzliya says that home prices in Israel began rising in January 2012, by an average of 0.34% a month, after falling slightly over the three preceding months. Home prices rose by 1.54% in the 12 months through September.

The new Gazit-Globe IDC Herzliya Index says that in the July-September when there record amounts of new mortgages were granted, there was no corresponding variance in home prices. On the contrary, prices rose by a negligible 0.07% in August and 0.03% in September.

The index is the fifth real estate index in Israel, joining the Central Bureau of Statistics, the Government Assessor, the Ministry of Housing and Construction and the Ministry of Finance's monthly Red Lights survey. Gazit-Globe Real Estate Institute's index is based on the Case-Shiller Index of Property Values in the US.

The new index has a 97.27% correlation at the national level with the Central Bureau of Statistics' Prices of Dwellings Index, but indicates that home prices rose by 7.5% more than the rise indicated by the Price of Dwellings Index. The Central Bureau of Statistics reported that the average home price was NIS 1,118,000 in the second quarter, but the new index that the price is closer to NIS 1.2 million.

Published by Globes [online], Israel business news - www.globes-online.com - on October 31, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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