Can you afford to buy property in Israel?

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A few weeks ago, I published an article explaining why now is the time to invest in the Israeli real estate market. Many readers in the diaspora wrote to me afterwards to tell me that while they would love to buy property in Israel, it is simply too expensive to buy a home here. And they aren’t wrong, Israeli property has become increasingly unaffordable. Land here is in constant demand and there is limited supply. The island economy and general cost of living pose a challenge for diaspora Jews, specifically younger families, to buy property here.

That being said, as a property lawyer who has helped many Olim buy their first home in Israel, I know that there are several areas in Israel that are much more attractive financially, than the more well known hubs of Tel-Aviv, Jerusalem, Raanana, Tel-Mond, and Herzliya.

So I’ve decided to create a short guide of places that you may not have heard of, but are definitely worth exploring, if you’re interested in buying a home in Israel. These are just some of the communities worth considering. These towns, cities, and Yishuvim have thriving Anglo communities and offer a lot to their residents. Most importantly, they are much better value for money, and simply put, are more affordable.

Karmei Gat.

Karmei Gat is located just 35 miles south of Tel Aviv (40 mins by train, or an hour by car) and is a brand new suburb of Kiryat Gat. The suburb is almost entirely new and offers plenty of new built houses and apartments. Karmei Gat boasts a growing Anglo, Dati-Leumi community and there are Shuls, kindergartens and schools nearby.

From an investment perspective, prices are still comparatively low, and since 2021, there has been an increase in demand for property in the Karmei Gat. The Israeli website Yad2 published a spike in interest in the neighborhood between 2021 and 2022. A new rail line connecting Kiryat Gat to Tel Aviv makes it an even more attractive place to both live, and invest in.

A brand new 5 room apartment (approx 130 sq m) will cost roughly 2.5 million NIS and the average price per square meter is between 18,000-20,000 NIS. Buying property in Karmei Gat is attractive because it serves as an investment property as well as a potential future home for Diaspora Jews considering making Aliya in the future.

Harish

Harish is a relatively new city in Israel situated near Hadera. It’s just 50 minutes by car from Tel Aviv and is just 15 minutes by car from Haifa. The city is almost entirely composed of new builds, and there is already an Anglo shul and community in Harish. Unfortunately Harish doesn’t have it’s own train station making it a little cut off from public transportation.

That being said, the property prices are very attractive. A 5 room apartment (approx 130 sq metres) can be found for 1.9 million NIS, and the average price per square metre is between 13,000-15,000 NIS. Harish is popular amongst young couples and families as it has great access to the Number 6 highway, and is surrounded by greenery and nature.

Carmiel

Carmiel is the northernmost city in this guide, and while it is by no means central, Carmiel is a stunning small city, home to 40,000 residents, located in the Galil, near Acre and Safed. It’s about an hour and a half drive from Tel Aviv or a 2 hour train ride (130 km). The city is divided into different neighborhoods with Ramat Rabin being the newest neighbourhood, popular with young families, even though it’s farther from the train station (10 mins by car).

Financially speaking, Carmiel is really attractive. Many of the homes come with nice gardens attached and there is a lot of land. A 5 room apartment can be found for approx 2 million shekels. Carmiel is well developed and there are commercial centres, parks, and shuls in the area.

Modiin

Modiin, situated in between Tel Aviv and Jerusalem is a well known and well loved city for Olim. 40 minutes by car or train from Tel Aviv, it really is located bang in the middle. There are two main Anglo neighborhoods, Moriah neighborhood, and the Avnei Chen neighborhood, Moriah being the slightly more expensive one between the two. Modiin is full of parks, shuls, schools, and kindergartens and is very family friendly.

As a well-established city in a great location it’s one of the more expensive options on this list but prices are still lower than Tel Aviv. A 5 room apartment (approx 130 sq meters) in the Moriah neighborhood will cost around 4.5 million NIS, and the average price per square meter is 35,00 NIS.

In the Avnei Chen neighborhood, the prices are a little lower, with a 5 room apartment (approx 130 sq metres) will cost around 3.5 million NIS, and the average price per square metre is 28,000 NIS. For those who can afford it, Modiin is a great city with a lot to offer both from an investment perspective, and as a city to live in.

This list is by no means exhaustive. There are many more towns worth considering where the price barrier is much lower or may be non-existent. Israeli real estate is extremely expensive but it’s also a relatively sound investment. According to the Jerusalem post, over the last decade, property prices in Israel have risen over 300%. Taking into consideration several wars and financial crises, it’s not too bad of a growth rate.

If you see yourself living in Israel in the future, now is a great time to explore the different property investment opportunities here. While you may not be able to afford your dream home in Herzliya or Tel Aviv, there are still plenty of areas in Israel with great growth projections that are worth checking out.