Tel Aviv luxury apartment sales plunge

Tel Aviv luxury apartments
Tel Aviv luxury apartments

Only four luxury apartments were sold in July-August, down 94% from last year.

The number of deals in the Tel Aviv housing market is plunging. Israel Tax Authority figures for recent months indicate that only four deals for the sale of apartments in Tel Aviv at a price tag of NIS 5 million or more took place in July-August 2014, This a niche market, with deals being signed infrequently, but there was a significant difference in the number of transactions, when compared with July-August 2013.

There were no fewer than 82 deals in the corresponding period last year. Excluding deal for which data are lacking on the Tax Authority site, the number of deals was 68, meaning that the number of transactions for luxury apartments was down by a mind-boggling 94%.

Keep in mind that updating of deals in the Tax Authority computer system is inadequate, due to the lag in updating deals by the sellers, which can amount to 50 deals in a day. For this reason, it is possible that more than four deals in excess of NIS 5 million took place during July-August 2014, but even if the figures are wrong, it is extremely unlikely that there were enough deals to make up the gap.

Real estate sources marketing luxury apartments who have expertise in this market segment confirmed the figures, and added that times were tough in luxury housing. "Few apartments were sold for over NIS 5 million in the past two months," a marketer of apartments who works in Tel Aviv said. "Uncertainty, the economic situation, and Operation Protective Edge have made an already bad situation worse. Sales during the summer are usually strong, but this didn’t happen this year, and many foreigners who buy apartments at these prices didn't come to Israel this summer. I hope that the situation improves during the upcoming holidays."

Real estate agents also unanimously agreed that the state of the luxury housing market had deteriorated, and not just in the past two months. "There are fewer deals, and it's continuing last year's trend," said a real estate agent specializing in luxury properties who operates in Tel Aviv. "I don't know whether or not the Tax Authority reports for the summer months were updated, but we've been feeling a slide in the market for months. Among other things, this is caused by the new tax on luxury apartments and the elimination of the exemption from betterment tax. We are also seeing luxury apartments waiting longer on the shelf. It may be that the potential buyers are also looking at what is happening in the Israeli market, and are waiting for a reduction in prices."

Published by Globes [online], Israel business news - www.globes-online.com - on September 10, 2014

© Copyright of Globes Publisher Itonut (1983) Ltd. 2014

Tel Aviv luxury apartments
Tel Aviv luxury apartments
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