Over the past year, as housing prices soared by an astounding 13 percent and Israelis broke records in taking out mortgages, senior housing officials evidently had a great deal of free time. No emergency plan to deal with the surging prices has been unveiled, and efforts to address the critical strategic questions that will determine what life will be like here in another two decades – when the country will be populated by more than 15 million people – have also been sidelined.
It’s therefore bizarre that the main issue on which Interior Minister Ayelet Shaked and the head of the Planning Administration, Dalit Zilber, have spoken out on is the future of Tama 38, a program that encourages homeowners to reinforce their homes against earthquakes by allowing apartment buildings that do so to build and sell additional apartments.
Although Tama 38 has greatly contributed to increasing the supply of apartments in major cities – in the 15 years following its approval in 2005, construction permits were issued under this program for more than 81,000 new apartments – it is actually fairly marginal in terms of the overall housing market. The market needs 60,000 new apartments every year, yet Tama 38 has provided an average of only 3,000 finished apartments a year since its inception.
Moreover, the program has languished over the last two years due to poor management on a national level. The amount of time needed to obtain construction permits under Tama 38 has become unacceptably long. Whereas it used to take an average of a year, it now takes more than three on average. And for reinforcement and construction projects carried out under another plan, Tama 1, it takes an average of four years to get a permit.
Thus, the argument between Shaked and Zilber – a technical dispute over how long the program should be extended for (they finally settled on a year) – didn’t stem solely from power struggles and ego clashes, but also from the helplessness all the relevant players have demonstrated regarding the big questions facing the housing market. Shaked, Housing Minister Zeev Elkin and Finance Minister Avigdor Lieberman, just like all the politicians before them, have preferred to focus on specific programs in the hopes of reaping a little political capital. And most of these are recycled versions of past programs that failed while costing the economy billions of shekels, like the Mechir Lemishtaken housing subsidy program.
To solve the housing crisis, the government must offer strategic solutions to improve life in Israel in the coming decades. This means diverting the overflowing demand from “the State of Tel Aviv” to other parts of the country; developing attractive, lively cities in the Negev and Galilee that will be suitable alternatives for young people; and promoting plans to solve the never-ending traffic jams and destruction of the little open space that remains.
The above article is Haaretz's lead editorial, as published in the Hebrew and English newspapers in Israel.