Latest transactions in White City Residence

Prices continue to edge up in White City Residence with the price per square meter now reaching $18,000 for higher floors.

Those changes are not isolated to that building and are worrying the Bank of Israel that has just decided to further tighten rules for mortgages. Going forward, and in order to prevent a real estate bubble from developing, borrowing will be capped as follows:

• 75% LTV for the first purchase
• 70% LTV when purchasing of a bigger property and selling the first one
• 50% LTV for the purchase a second property within the same family

Sea One vacation flat sold for $4.8m

A 190 sqm flat located on the 19th floor of the 23 stories Sea One sold recently for NIS 18.5 million, i.e. $4.8m. The fat is facing the sea and has two balconies totaling ​​25 square meters as well as two underground parking spots.

The Sea One is located near the shore of Tel Aviv, on a plot of four acres, between Hayarkon and Herbert Samuel. The building which is due to open its doors this spring will also be the home of a luxury hotel managed by Isrotel under the Royal Beach brand, a shopping area, a pool overlooking the sea and a public parking lot. The tower had made the news in 2009 when Russian oligarch Valery Kogan bought the penthouse for 110 million ($28 million) -- the most expensive flat ever sold in Israel at that time (the record has since been broken by Eyal Ofer).

New 10% tax on developers who don’t build fast enough

The cabinet today decided that developers who do not build homes on lots they hold will pay a tax of up to 10% of the price of the land when it is sold. Revenues from this penalty tax could amount to tens of millions of shekels on lots in high demand areas in central Israel. The cabinet approved an amendment to the Land Tax Law, with the objective of increasing the housing supply by taxing developers who hold on to land for years without building on it. In some cases, the developers are trying to maintain price levels. The Trajtenberg Committee recommended increasing the housing supply by encouraging construction on lots zoned for residences by amending the law by the end of March. Over six months later, the cabinet approved the bill, which applies the stick to contractors, rather than the carrot. A developer who owns a lot zoned for at least 200 apartments for up to three years without starting construction, will be exempt from the tax when the land is sold. In the fourth year, a 1% tax will be levied on the sale price of the land; in the fifth year, the tax rate will be 6%, and in the sixth year and later, the tax rate will be 10%.