Housing Min. proposes pushing construction of rental apartments

The Housing Ministry on Tuesday presented a bill to Knesset which would push the state to encourage the construction of rental apartments.

If the bill is approved, the government will grant tax benefits to entrepreneurs, obligating them to rent apartments for 25 years and uphold the building and property.

The bill, which was initiated by Acting Justice Minister Meir Sheetrit, is intended to improve the economic feasibility of building rental complexes in Israel.

The Housing Ministry hopes the bill will be passed within a month, yet is concerned that the treasury and Tax Authority will oppose the tax benefits.

According to Housing Ministry statistics, there are 300,000 rental apartments on Israel's open market. Attempts to expand this market over the years have brought a mere 9,375 additional rental apartments.

"These are very low numbers, indicating a lack of economic feasibility," Sheetrit said. "I have no doubt, that when the market for rental apartments is created with regulated supervision, rental prices will decrease, renters will be able to live in apartments for longer periods, and the sight of young couples mortgaging all their economic abilities in order to buy an apartment will disappear from view."