Business in Brief

Young couples lead second-quarter rise in new-home purchases

A jump in the number of first-time home purchases by young couples and the return of investors to the real estate market are the two major trends noted in the quarterly real estate review published yesterday by the Finance Ministry. In the second quarter of the year, 26,700 homes were purchased, a 9% increase over the second quarter of last year. The second quarter home sale pace was also about 9% higher than the first quarter of this year. In the Jerusalem area, however, home sales declined by 2% from the prior quarter, but it was also the only area where purchases by foreign residents picked up. Nationwide, about 11,100 of the homes purchased in the second quarter were bought by first-time buyers, mostly young couples. (Nimrod Bousso)

Survey finds 15% of building firms are in financial trouble

About 15% of all companies in the construction, real estate and infrastructure sector are experiencing financial difficulties, a survey by the business information company BDI said in a report released yesterday. BDI said the industry saw a small rise in business risk over 2013 but that the problem would likely become worse next year. Among sector companies traded on the Tel Aviv Stock Exchange, BDI found from a survey of their financial reports that 28% had been tagged by their auditors with a "going concern" or similar warning. "Bank of Israel restrictions allow the banks to apportion no more than 20% of their loan portfolios [to the building sector]," said BDI Co-CEO Eyal Yanai. "The inability of contractors to get credit can lead to delayed payments to suppliers and the company's collapse." (Nimrod Bousso)

Energy Mininstry renews subsidiary to replace power-guzzling refrigerators

The Energy Ministry said yesterday it is renewing a NIS 50 million program to subsidize energy-efficient refrigerators. The aim is to coax households into trading in older, electricity-guzzling models - a number estimated at about 50,000 - for new models with subsidies. The assistance is equal to about 30% of the cost of a new refrigerator, or between NIS 800 and NIS 1,200. Replacing 50,000 fridges would save 60 million kilowatt hours and save each household NIS 750 annually, the ministry estimated. The program, which began a year ago, is now slated to run until the end of 2013, during which time the ministry hopes to replace some 140,000 refrigerators. To qualify, a refrigerator must be at least seven years old and have a capacity of at least 300 liters. A list of approved merchants and models appears on the ministry's website. (Itai Trilnick )

Exports by Arab sector account for just 1% of the total

Exports by companies in the Arab sector amount to less than 1% of the total, the Industry, Trade and Labor Ministry said yesterday, in advance of a meeting set to take place today between its economic attaches and Arab executives in Nazareth. About 20 Arab-owned companies engage in exports, ranging from traditional products like food and soap to high-tech. But despite what trade officials said were quality products with a great deal of potential, their sales overseas amounted to about NIS 30 million annually. In response to growing interest by Arab companies in exporting, the ministry recently established its Tevel program with a NIS 2 million budget to help selected businesses with expanded aid and advice on developing markets. (Tali Heruti-Sover )

VAT raids on 53 Tel Aviv-area businesses nets NIS 8m in unpaid tax

Tax officials announced yesterday that they raided 53 Tel Aviv-area businesses last week, including 28 auto-repair garages, 13 restaurants and 12 hair salons, on suspicion they were not paying value-added tax. The raids were conducted under the Tax Authority's "You avoid, you pay" campaign, which has seen a series of operations focused on specific geographic areas. Last week's raid followed four months of surveillance at garages and visits by undercover agents. All told, the operation last week netted NIS 8 million in unpaid VAT. (Moti Bassok )

IDB settles with bondholders

Nochi Dankner's IDB Holding Corporation has reached an agreement with bondholders to reschedule its debt. The deal, reached Tuesday night, calls for holders of Series Dalet bonds to defer payment they were due until the end of March. In return, Dankner's privately held Ganden Investments is to inject an initial NIS 120 million, to be followed by another NIS 60 million by the end of May. The arrangement is accompanied by an assurance that a payment rescheduling plan will be presented to all of the company's creditors by the end of April. (Shelly Appelberg and Michael Rochvarger)