Monday, January 26, 2009

Israel's Real Estate Market booming while world's Collapses

I was wondering yesterday what caused the sharp rise in home prices in Israel over the last 3 years. The real estate market in Israel is booming and it is still a seller's market. Words you couldn't hear in the US for the last 4 years - a seller's market.

In the 90-s Israel had a similar real estate boom and it was related to the huge wave of immigration from the former soviet union. Eventually that wave declined and almost reached a halt in the early 2000-s. What followed that decline in immigration wave was a huge decline in home values - and the market somewhat froze. I remember people weren't happy to owe more on their home than it's worth - much like I owe more on mine here in Michigan.

But the tides have turned in Israel - just in reverse correlation to the rest of the world. The reason - unsurprisingly is again a silent wave of immigrants. This time, Jews are fleeing Europe. Since 2005, Jews in France have decided they do not wish to remain in a 1939 Nazi Germany environment and have practicably "bought out" complete neighborhoods in Israel. Ashdod to be exact. Ashdod which was bombarded by Hamas during the recent war. Reviewing the choice between being murdered in the streets of Paris by Arabs, or being threatened by them in Israel - French Jews choose Israel.

There's more to it. There are many "high-end" real estate developments on the shores of the Mediterranean and even those who do not immigrate but have deep pockets are buying in. Would you resist a beach front apartment facing the Mediterranean as a summer home if you could afford it?

Relevant source in Hebrew: High end beach front real estate development sells out to French and US Jews

Well, the exact translation of the title is:
"In the project 'Neve Zedek on the Sea' they claim that there are many addresses of Jews from France and USA for high end apartments in response to recent war: 'in last wave of antisemitism they bought all of Ashdod'"

Auto translated here.

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