Israel Housing Market Sees Slight Price Increase After Decline

The Israeli housing market is signaling a slowdown and a slight rise. According to data from the Central Bureau of Statistics, housing prices have risen by a negligible 0.1% over the past year, comparing October–November 2025 to the same period in 2024. This is an unusual figure by Israeli standards, following a decade characterized by sharp increases, high volatility, and at times, even occasional declines. In the short term, there was a moderate rise: Comparing October–November 2025 to September–October 2025, housing prices increased by 0.7%. This means that the market is not in decline, but it is also far from accelerating. Sharp Differences Between Regions An examination by district shows an uneven picture. In the two-month increase, Jerusalem stood out with a rise of 1.5% and Tel Aviv with 1.2%. In contrast, the Haifa district recorded a decrease of 0.3%. The central, northern, and southern districts saw moderate increases of 0.3% to 0.5%. Yearly comparisons show even more pronounced differences: Jerusalem leads with a 9.4% increase, the north with 5.4%, and the south with 1.2%. Conversely, traditional high-demand areas experienced declines – the central district decreased by 2.9% and Tel Aviv by 2.8%. New Apartments: Annual Decline The new housing market also showed a mixed trend. Over the two-month period, prices of new apartments rose by 1.0%. The share of transactions under government programs increased to 45.1% of all deals, and when excluding these transactions, the increase was 1.2%. However, on an annual basis, the picture reverses: Prices of new apartments fell by 0.8% compared to the same period last year – a figure that reflects buyer caution and the difficulty for new projects to generate sustained price increases. The Overall Picture The data indicate a housing market in an interim period: Not a collapse, but also not a continuation of the wave of price increases that characterized recent years. The minimal annual rise, alongside sharp regional gaps and weakening new apartment prices, reflects a more cautious market – one where buyers are waiting, and developers are advancing at a calculated pace. Real estate experts predict further interest rate cuts by the Bank of Israel governor. Yaakov Nitzan, CEO and partner at Ruby Capital, notes: "The recent interest rate cut has already sparked activity in the market, and the expectation is for at least two more cuts, each by a quarter of a percent, during 2026. These cuts will increase economic confidence and the ability to take mortgages, bringing new buyers into the market."