Apartment prices in Tel Aviv 32% higher than last year

The average nominal price of an apartment in Israel was 3.2% higher in the second quarter of 2010 than in the preceding quarter, and 17.2% higher than in the corresponding quarter of 2009, the government assessor reported today. The Consumer Price Index (CPI), excluding housing, rose by 2.2% between the second quarter of 2009 and the second quarter of 2010.

The government assessor reviewed a sample of 4,700 purchases of apartments in 16 cities in the first and second quarters of 2010.

In Tel Aviv, the average price of a four-room apartment rose 32% to NIS 2.31 million in the second quarter from NIS 1.76 million in the corresponding quarter. In Herzliya, the second most expensive city, the average price of a four-room apartment rose 14% to NIS 1.65 million in the second quarter from NIS 1.44 million in the corresponding quarter. The average price of a four-room apartment in Jerusalem rose 19% to NIS 1.62 million in the second quarter from NIS 1.35 million in the corresponding quarter; the average price of a four-room apartment rose in Haifa rose 20% to NIS 985,000 from NIS 823,000, and the average price of a four-room apartment rose in Beersheva rose 23% to NIS 626,000 from NIS 508,000.

The government assessor said that while apartment prices were affected by several factors, it was difficult to isolate the effect of any single factor. However, it seems that the low inventory of new apartments for sale - about 13,000 units - is a dominant factor, which is pushing prices higher.

Source Globes