2010 Is Done, What Should We Expect In 2011?

Comments

  
  1. Totally agree Mr Bortnick that the market won’t crash. As you say, the reason why is that its not built on hype solely (although I agree that the market has been hyped past, thats not the case now). Factors that have contributed to the rise of the Israeli property market are;

    1. Repressed market due to political issues such as 90s bus bombings and Intifadeh II. Therefore, the market had to catch up soon after 2003 when the situation stabilized.

    2. Israeli Lands Authority not making enough land available for new buids thus creating a huge surplus of demand by Israeli buyers.

    3. Major foreign investment especially by the French in 2007 was a major factor in propelling the market forward. The speculation amongst foreign investors continued even after the French slowed down because Israel became known to be a “great place to buy”.

    4. The 2008 “slowdown” was not initiated by Israel but rather a general uncertainty in the world by countries that really do have economic issues. However, Israeli buyers and sellers were caught up in the world’s problems and therefore the market paused between Mid-2008 and 1st Qr. 2009 whilst the market evaluated whether Israel really was affected or not. This pause was akin to shutting off the oxygen to a fire which continued to burn. When traders realised finally that Israel had nothing to worry about, the “windows were re-opened” in Spring 2009, the buyers rushed in and the market roared!

    At this point I agree with the prognosis for 2011, the market will calm down. However, prices won’t go down, they won’t go up by double digits either. There is likely to be a plateau but a continuation of a general shortage of properties. There will be a greater defining of markets within Israel; old, unrenovated properties will gain slightly in value however the disparity between unrenovated and renovated will continue to exist therefore the opportunities for investors and developers will continue to exist.

    Going forward, the market will be affected by the Israeli Lands Authority releasing large amounts of land for new builds. The influx of the “new build luxury condos” is going to weaken that area of the market.

Leave a Comment

© 2017 The Maki Group - All Rights Reserved All information provided is deemed reliable but is not guaranteed and should be independently verified. No warranties or representations are made of any kind.