The Mishkan Housing Market Index, a monthly index that measures the financial conditions of the Israeli Housing Market, hit a 6 year low in December 2010, the lowest since October 2004. The index is made up of 4 factors; the Israeli average salary, the unemployment rate, national apartment prices, and the mortgage interest rate. According to Bank HaPoalim, “the prices of homes in Israel rose 14.7% in the preceding 12 months. Since the last low point in 2007, prices has risen 38% in real terms”. That being said, the index has fallen 21% from its high point of 171 points in July 2008.
What does this mean for you if you’re a home buyer these days? Well, a drop in the index basically reflects the worsened conditions for you, as it makes it more difficult, mortgage or not, to purchase property here in Israel. These are just the hard, cold, fact; what you do with them is up to you. As always, I welcome your comments, questions, and suggestions!