On Wednesday, the Israel Land Authority made a dramatic announcement: “The leasers of farm land (Israel land is leased for 49 or 99 year leases instead of ownership) who will rezone their land for housing will receive proper compensation from the state.”
This will help add thousands of apartments to the real estate market in Israel. This market suffers from a very low supply and a very high demand which makes owning a home and unattainable dream for more people every year. With a larger supply the prices should drop and owning an apartment will be in the reach of more people.
At this point the lands will be marketed at the “price to dweller value” where developers are forced to bid lower for the land based on the final price per apartment established.
Advocate Ziv Caspi told Ynet this morning: “According to the land ministry decision leasers will profit from the rezoning of their land. As soon as there is payment for this many kibbutzim and moshavim and even private leasers will be happy to release lands for housing. This change will without a doubt bring a great amount of apartments into the housing market.