Home prices rose by 0.6% in August 2012, after rising 0.7% in July, the Central Bureau of Statistics reported yesterday. Home prices rose by 3% in January-August, and at the end of June the average home price was NIS 1.1 million.
The Central Bureau of Statistics publishes the Prices of Dwellings Index at the same time as the Consumer Price Index (CPI). The housing item (rent) in the CPI for September fell by 0.3%. The Prices of Dwellings Index is based on a random sample. The final figures for the Prices of Dwellings Index for August will be published in a few months.
In August, banks granted NIS 5.8 billion in new mortgages, an all-time high. Despite the few working days in September, due to the Jewish holiday season, the banks estimate that NIS 3.2 billion in new mortgages were granted during the month, 7% more than in September 2011.
In an extraordinary step, the Bank of Israel yesterday warned against the development of a real estate bubble. In its review, "Recent Economic Developments - May to August 2012", it said, "Mortgage volume data indicated a return of buyers to the housing market, and this data in and of itself may create expectations of continued price increases. If these expectations are fulfilled, a price bubble may develop in the housing market.
Published by Globes [online], Israel business news - www.globes-online.com - on October 16, 2012
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