The cabinet today unanimously approved the housing chapter of the Trajtenberg Report, eight months after they were submitted. The recommendations seek to respond to demands for affordable housing in last summer's social protest.
The cabinet vote came after the deal between Shas and Yisrael Beitenu, which includes NIS 1.5 billion for immigrants in exchange for Yisrael Beitenu withdrawing its objections to the absence of the fulfilling of earning capacity criterion for eligibility for affordable housing.
The cabinet approved the marketing of land for 187,000 apartments nationwide over the next five years. 60% of the apartments will be in high-demand areas in the Tel Aviv, Central, and Jerusalem districts, including 40,000 affordable housing apartments.
However, extrapolating the rate of home completions of the past two years, gives 165,000 new apartments over five years, which means that the cabinet decision will add just 22,000 new apartments over this period, or 4,400 apartments a year.
Government aid for people eligible for rental public housing will rise to a maximum of NIS 3,000 from the current 1,750. The budget for this item is NIS 160 million a year for five years, for a total of NIS 800 million.
To bring "ghost apartments" (empty apartments) on to the market, the property tax ceiling on apartments that stand empty for over six months a year will be doubled. The government estimates that this measure will add to the market 15,000 apartments a year in high demand areas. As for apartments deemed unfit to live in, the exemption on the property will be valid for only nine months, after which the double property tax will be levied on apartments that not renovated.
To prevent contractors who win tenders from delaying in building, a levy of up to 10% of the price of the apartments built will be imposed for not completing construction projects within two years from the receipt of the building permit.
The government will also budget NIS 50 million to remove obstacles to vacate-and-build projects, NIS 250 million for planning and building projects in minority areas, and reduce the concentration in the construction industry by dividing land tenders among several winners.
Published by Globes [online], Israel business news - www.globes-online.com - on March 18, 2012
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