There were 6% fewer housing starts in the first quarter of 2014 than in the preceding quarter and 16% fewer than in the corresponding quarter of 2013, the Central Bureau of Statistics reported today. The number of housing starts in the first quarter was the lowest in five quarters, since the third quarter of 2013.
The number of housing starts fell to 10,341 units in the first quarter from 10,981 units in the preceding quarter. The Central District accounted for the largest number of housing starts, 30.5% of total starts nationwide.
It is premature to determine if the drop in housing starts was affected by the zero VAT plan that Minister of Finance Yair Lapid announced in mid-March, because housing starts are based on wins in land tenders by contractors and developers.
The number of housing starts fell nationwide, except for the Jerusalem District, where they rose by 13.7%, compared with the corresponding quarter of last year. Housing starts fell 76% in Judea and Samaria, 40.5% in the Haifa District, and 22.8% in the Southern District.
Real estate industry sources warn that despite the wave of land sales by the government under blanket agreements, the stagnation in new home sales because of the zero VAT plan could further reduce housing starts in the long term.
Published by Globes [online], Israel business news - www.globes-online.com - on May 29, 2014
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