In the last 16 years, the market has not stopped rising, the rise in interest rates, which according to all estimates is expected to continue, together with other factors may put us in less familiar territory.
The rise in interest rates, which follows record inflation in many countries around the world, including the United States and many EU countries, some of them a negative 40-year high, is also reaching Israel these days and puts the real estate market on hold. At 0.5 percent the interest rate is expected to rise to at least 2.75 percent in the coming year.
It is important to add that not only is the interest rate set by the Bank of Israel rising, but the margins that the banks take from mortgage customers and also from entrepreneurs on the interest rate set by the Bank of Israel. That is, the real rise in interest rates is not only half a percent, but the banks are raising their bank margin while another interest rate to price their risk that rises in cases of non-repayment of loans or alternatively the cost of raising their capital.
Israel real estate market is changing
Walla! News 09.07.2022
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