The number of homes sold to investors between July and September dropped by 70% compared to the period from April through June, the treasury reported on Tuesday.
- Home buying jumped in first quarter, led by investors
- Housing prices in Israel continue to rise in third quarter
Overall sales between July and September to buyers of all kinds dropped by 33% to 24,000 although by historic standards the figure is still very high, with purchases led by buyers in outlying parts of the country. The drop in home purchases for investment resulted from investors seeking to beat the imposition of higher purchase taxes on homes bought for investment that came into effect at the end of June. All told, 3,900 homes were bought for investment in the third quarter, the lowest level since 2003, and investors accounted for just 16% of all home buyers in the quarter.
Despite the higher purchase tax paid by buyers of investment housing in the third quarter, the drop in the pace of sales for investment resulted in a tax take by the treasury of roughly 400 million shekels (or about $100 million) in third quarter from buyers of investment homes, compared to a billion shekels in the second quarter of the year.
The number of second-hand home sales of all kinds fell 33% in the third quarter, which also saw a 32% decline in new homes sold by construction contractors, a drop particularly felt in the Tel Aviv area.