Housing Cabinet Backs Giant Building Plan

Long-term plan program sees 1.5 million new homes being built by 2040.

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New apartments at the planning stage in Jerusalem.
New apartments at the planning stage in Jerusalem.Credit: Totem

Over the objections of environmentalists, the housing cabinet Monday approved plans to build some 1.5 million new homes over the next 23 years, an average of 65,200 annually.

The plan envisages keeping construction at about its current pace, which was 52,700 housing starts in 2015 and 38,600 in the first nine months of 2016. After that, the rate of new construction is supposed to grow to 61,000 annually in 2026-30 and to 67,000 annually in 2036-40.

The blueprint comes as Finance Minister Moshe Kahlon struggles to cool off an overheated housing market, where prices have more than doubled since 2007 and risen by 8% in 2016. He was dealt a setback last week when the International Monetary Fund cast doubt on one of his key programs, Machir L’Mishtaken, saying it wouldn’t have a long-term impact on prices.

“For the first time in years there is a strategic plan not only for the short term but for the long term, too,” Kahlon said Monday after the housing cabinet approved the program. “For the short term the government is putting young couples and those most in need of a home as top priority and dealing with the root causes of the housing shortage. In the long term, our job is to ensure that a new crisis isn’t created.”

The long-term plan, which was designed by the finance and housing ministries together with the National Economic Council and Planning Administration, is focused on developing more housing in the Galilee and Negev as well as encouraging higher density housing in the center of the country.

But on Sunday, a day before the ministers voted, environmentalists took the plan to task.

“If the proposal is accepted, it will override the country’s planning apparatus and empty of any meaning the main national development that was recently approved,” said Iris Hann, director of the Society for the Protection of Nature, and Amit Bracha, head of the Adam, Teva V’Din environmental NGO, in a joint statement

In the Arab sector, which is suffering a severe shortage of housing, the plan calls for 21,000 new homes to be built every year between now and 2020. In the five following years, the number is supposed to grow to 23,000 annually.

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