“Markets were made to serve us; we were not made to serve markets. They depend on respect for the people affected by our decisions. Lose that and we will lose not only money and jobs but something more significant still: freedom, trust and decency, the things that have a value, not a price.”
—The late Rabbi Jonathan Sacks in his book – “Morality”
In presenting his plan for affordable housing developed by researchers over several years at the Institute for Structural Reforms-Tel-Aviv University, attorney Shraga Biran, a major real-estate entrepreneur and chairman of the Institute, destroys the myths that housing prices will never go down, housing stock exhausted with no possible solution. Biran spells out how reforms to the housing market can make well-designed affordable housing a reality.
The situation today: for the last two decades the Israel Lands Administration (ILA) has been marketing land by means of tenders awarded to the highest bidder. Land costs vary between 25-30% and up to 50-60%! of the cost of an apartment, incredible figures, resulting from the ILA’s speculative marketing. ILA profits in 2022-2023 are estimated at close to 203 billion shekels. Needless to say, this process has resulted in hundreds of horribly designed large-scale building projects nationwide built on an individual and random basis bearing no relation whatever to their existing urban context.
In order to enable those lacking an apartment one of their own, (730,000 households comprising 2.5 million citizens including children), the ILA’s goal of maximum profit in the short term at the expense of housing must come to an end.
To date, greatly oversimplified “demand” factors have been the basis of the actions of the ILA, totally unrelated to the socio-economic status of Israel’s various population groups, with highly destructive results. Marketing state-owned lands must be made compatible with Israel’s diverse populations, thereby eliminating speculation.
Biran attacks the myth of the depletion of the nation’s land reserves: almost all of Israel’s lands – 91% of which are owned by the state and available. IDF firing zones, most of them in the Negev south of Beersheba, if cleared, total some 7.6 million dunams. Millions of Israelis live on just one million dunams of Israel’s total area – 22 million dunams. Add to this the rural areas, some 1000 settlements whose land area, 600,000 dunams, Biran sees as a “Garden of Eden” for development – “a crime not to exploit”.
Needed to be made available for marketing, he estimates, are just 40,000 dunams distributed nationwide. Unplanned smaller properties would be offered to smaller building firms, which till now have been disregarded. Neighborhoods would be planned comprehensively, enabling rapid entry to the market, aiding the Israeli economy.
A new market-based national master plan for urban renewal would be prepared with comprehensive long-range planning incorporating incentives to builders and local authorities.
Biran points out that Israel’s existing legal system enables the immediate implementation of the Institute’s proposals without the need for additional laws. It’s high time for the ILA, which has been operating for years in violation of the 1960 law that clearly sets out its social commitments, to adhere to its mandate, enabling the Institute’s proposed national housing policy. Affordable housing, he adds, will help in fighting poverty in Israel.