Bank of Israel: Home prices still rising

housing

Despite the slowdown in transactions and lower mortgage taking, home prices are rising at a high rate.

Despite the slowdown in transactions in the housing market reported by the Ministry of Finance, home prices in Israel are still rising. In the minutes of discussions on the January interest rate, the Bank of Israel Monetary Committee said, "Home prices continue to rise at a high rate, even though the stock of unsold new homes is high, and in the past year there have been more than 50,000 building starts. The slowdown in monthly mortgage volume continues, with a continued increase in mortgage interest rates."

On interest rates, the Research Department expects the rate to remain at its historic low of 0.1% until the fourth quarter of this year when it is likely to rise by 0.15% to 0.25%. In 2018, the Monetary Committee sees the interest rate rising to 0.5%.

On inflation, the Research Department sees price rises returning to the Bank of Israel's annual target of between 1% and 3%. The Bank of Israel expects final 2017 growth of 3.2% up slightly from its previous forecast of 3.1%.

Published by Globes [online], Israel business news - www.globes-online.com - on January 9, 2017

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

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