Housing minister: Price rise is halting

Yoav Galant

Minister of Construction and Housing Yoav Galant responded cautiously to the drop in the home price index.

"I think we shouldn't get excited over a good result, and we shouldn't become depressed when the result isn't so good. That's my approach. We need to keep on working and keep on producing homes. The picture is one of cautious optimism, and I think that the figure stems from a moderation in the rise in prices," Minister of Construction and Housing Yoav Galant said today.

Galant was referring to the figures released by the Central Bureau of Statistics yesterday indicating that the home price index fell 1.2% in November-December, the first substantial fall since January 2007. The Bureau's figures could be revised later, and this not infrequently happens, which is one thing that accounts for the minister's caution.

All the same, Galant signals that in his view there is room for some optimism. "The rate of increases in home prices is dropping, and I believe that of we look at prices a year from now and they are stable, we will be able to start talking about a price fall. It depends on supply, and at the same time we have to see what happens to interest rates. If they rise, there will be other investment possibilities in Israel and globally, and that will affect demand, because a rise in interest rates will make mortgages more expensive. The most important thing is to halt the upward charge of prices. After a decade of rises, I think we are at the halting stage. I saw how for several months now there has been a change in prices of luxury homes. They are falling, and not selling. That is a well-known indicator worldwide that spring is on the way."

Published by Globes [online], Israel business news - www.globes-online.com - on February 16, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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