Minister of Housing and Construction Ariel Atias and Israel Land Administration (ILA) director general Yaron Bibi have presented a plan to lower home prices, by marketing land slated for the construction of 5,500 apartments.
Atias said, "The government should provide young couples with the minimal means to buy an apartment. Everything should be done to lower prices. We can't dictate prices, but we direct them through policy means.
"We'll publish tenders for large lots in a single event, as well as small lots in various locations, in order to give small developers the opportunity to bid in and win tenders, create competition between contractors, and make lower prices possible. We'll restore the dominance of the Land Administration and Ministry of Housing and Construction in the real estate industry."
Atias added that the Ministry of Housing and Construction would also act to create low-cost housing for young couples. "There are many cities that don’t want young couples to reside in them; they want rich couples."
Atias' plan states that 62% of the land slated for marketing will be in the Jerusalem District (for 3,300 apartments). The ministry believes that land for 567 apartments in Kiryat Gat, tenders for which failed last year, can now be marketed in the current market climate because of reduced development costs. Land will be marketed for 1,100 apartments in the Haifa and Northern districts, for 555 apartments in the Central District, and for 21 apartments in Tel Aviv.
Ministry of Housing and Construction director general Mordechai Mordechai said, "Housing prices are not only affected by supply, but by demand. They are affected by education, transport, infrastructures, and other factors. Prices in central Israel soared because there was no alternative in the periphery. We're trying to persuade the Ministry of Finance to restore location grants and loans to improve the periphery, which will influence housing prices in the center as well."
Published by Globes [online], Israel business news - www.globes-online.com - on September 8, 2009
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