Opinions are divided within the real estate market regarding the Bank of Israel’s measure to restrict financing incentives and balloon loans offered to apartment purchasers. Developers argue that this move will lead to a decline in apartment supply. Advocate Erez Gurion, Partner in the Real Estate Department at ERM, in an interview with Ynet, stated: ‘The implication of this directive is that, in the absence of the ability to offer attractive sales promotions, developers will find it challenging to reach the pre-sale targets required for obtaining bank financing, and they will be compelled to invest a greater amount of their own capital. This has implications both in terms of project timelines and costs (which will be reflected in increased apartment prices). It is likely that the Bank of Israel has concluded that this price is a price worth paying in order to maintain the stability of the banks and the Israeli real estate market.’
For the full article, click here: https://www.ynet.co.il/economy/article/h1mtxsc3jg