Recently, the social and ethnic composition of people immigrating to Israel has changed, along with them have changed their preferences when choosing a property.
The wave of immigration to Israel, observed throughout the 1990s, led to an unprecedented growth in the local real estate market. Homes across the country grew like mushrooms after rain. And many of the developers and contractors who were engaged in building Israel in those years, at the moment are among the leading players in the real estate market of this Middle Eastern state.
In recent years, the number of people immigrating to the Holy Land has decreased, however, according to experts, the global economic crisis, coupled with increasing antisemitism, will lead to an increase in their number in the coming years. According to the data of the Jewish Agency (an organization that deals with repatriation to Israel) in 2008, 15,441 people immigrated to Israel. According to experts of the organization, in 2009 the number of immigrants will grow significantly and will be approximately 18 thousand people. Naturally, any person moving to another country needs some kind of housing.
According to statistics from the Jewish Agency, 85% of immigrants to Israel buy or rent an apartment, and 15% prefer to live in specialized centers for immigrants, where they can learn Hebrew and become familiar with the customs of the country.
Experts predict that in 2009, about 7.2 thousand migrants from the countries of the former Soviet Union, four thousand Europeans and four thousand migrants from North Africa will arrive in Israel. Unlike the recent past this year, a significant number of immigrants will be made up of citizens of rich western countries, and this fact will undoubtedly affect what kind of property they will acquire, where they want to live, and what means they will have.
Anthony Galgut is a native of South Africa. His company provides all kinds of real estate services, among his clients are English-speaking residents of Israel and Jewish communities abroad. He says that many people who have hesitated whether they should move to Israel have now moved from thinking to business and are packing their bags. “Many clients of our company, without a doubt, sell their property, for example in the UK, even though they save less money for it in the current economic environment, and move to Israel,” the expert says.
Anthony Galgut also focuses on the high cost of specialized Jewish education and health care outside Israel. In Israel, all you have to do is register with the state health fund. “The economic crisis leads to the fact that such extra expenses become quite burdensome. Israel, if affected by the crisis, is relatively mild, and for people belonging to the highest socioeconomic segment, which are mainly immigrants to Israel today, the stability of the economy and the real estate market of the country in which they live is very important. ” says Mr. Galgut.
Significance of the environment
A study conducted by the Israeli Association of Real Estate Appraisers revealed that this year the market share attributable to immigrants and repatriates is likely to increase significantly. This will positively affect the demand for residential real estate in the center of the country. Erez Cohen, Chairman of the Association, says that the central areas of the state are an extremely important segment of the Israeli real estate market, despite the fact that it is rather small in terms of the number of buyers and objects. The fact is that most of the objects in Tel Aviv, Ra’anana, Kfar-Sava, and Modiin belong to the upper price segment.
Erez Cohen claims that in Tel Aviv and nearby cities, the number of immigrants may soon reach more than 15% of the total number of residential property buyers. It is logical: people who move to Israel tend to prefer to settle in well-developed major cities in the center of the country. It is easier to find a job, get a good education, or find fellow countrymen. “Even in the current, difficult economic conditions, many immigrants are in an advantageous position when acquiring Israeli real estate: they come to the market with euros, pounds or dollars, and these currencies are in a strong position relative to the shekel, respectively, immigrants can afford to buy Israeli high-class housing, ”he adds.
According to Anthony Galgut, next year 20% of the total number of new homes will be sold to immigrants and Israeli immigrants. Since these social groups mainly buy expensive housing, the share of such acquisitions in the total value of real estate transactions in the country will be quite high. The expert believes that immigrants and returnees buy up about 25% of objects in Raanana, about 17% in Modiin, 30% in Beit Shemesh, and in coastal cities (for example, Netanya, Ashdod and Herzliya-Pituach) this figure will be 15-18 % In addition, according to Anthony Galgut, 80-85% of immigrants prefer to acquire new housing and only 15-20% are interested in buying property in the secondary market. As for the housing area, immigrants are interested in at least four-room apartments.
Anthony Galgut says that few immigrants live in Jerusalem: “Israelis rarely buy housing in Jerusalem, apparently immigrants follow their example. The fact is that housing on the periphery is more modern and more comfortable for living. ”
Immigrants have another feature (of course, not all, but most). Unlike Israelis, immigrants usually have a strictly limited budget for buying a home , which they cannot exceed. In addition, two thirds of immigrants buy a property without a preview, but they carefully study it before buying it from photographs or entrust the selection of a house to authorized representatives.
According to one large Israeli developer who works a lot with immigrants, “immigrants are very demanding. However, when it comes to payment, they are not at all embarrassed, they ask if there will be any problems, if they transfer the shekels to a million-other dollars a little later. Among the Israelis, such cases are extremely rare, ”the developer says.