Housing Minister: We're cutting contractors' profit

Yoav Galant

People are telling contractors to sell at cheaper prices, Yoav Galant says.

"The public is unwilling to pay what it formerly paid for an apartment. The public has realized that an average apartment costs NIS 700,000 or NIS 800,000 to build. All the rest is profit for the contractor and developer. The land costs money, but people are now asking themselves why they should pay so much, and are telling contractors to sell at cheaper prices. This is where the buyer fixed price plan comes in," Minister of Construction and Housing Yoav Galant said at the annual conference of the Israel Builders Association.

Galant also commented on figures published by the Central Bureau of Statistics, showing a decline in the average housing price in the first quarter on 2017. He said, "The Central Bureau of Statistics is something that everyone says is representative. What I see is that prices are stable, and we'll go according to the market. Do I think that it's completely accurate? Not necessarily, but it has always been that way. The situation today shows that the market is cooling off."

Galant added, "The 0% VAT plan brought zero results. Nothing moved for two years, and then the prices jumped. That's not the case now. We're now doubling the supply, and we'll double housing starts. Up until now, we're relied on plans made before us, and now we're starting to benefit from actions that we have taken."

Published by Globes [online], Israel Business News - www.globes-online.com - on May 18, 2017

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

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