Atty. Yitzchak Steinberg, a real estate lawyer for the last 18 years who Has his own practice working mainly with foreigners buying in Israel, says that there are three main tips for buying an apartment in Israel.
The most important tip: “First and foremost surround yourself with people who are familiar with your culture and your expectations,” Steinberg says.
He notes that Israel has a different legal system and mortgage laws than the United States, and other systems are substantially different as well.
Don’t surround yourself with Israelis “who do not understand where you come from,” he recommends.
Second: Prices in Israel are in shekels. However, you might be getting quotes in dollars. Bear in mind there is fluctuation between the shekels and the dollar. If the dollar drops, people who get quotes in dollars according to a certain rate will suffer loses due to fluctuation.
Steinberg recommends: “Hedge yourself. Either try to get the price in dollars or at least convert the money as soon as possible so you will not be exposed to the fluctuation of the shekel and the dollar.”
Third: There is the construction index.
“When you buy a brand new apartment on paper, the price is linked to an index. This index is supposed to reflect the changes in construction supplies and materials,” he says.
He explains that this index in average until the beginning of 2021, averaged 1% to 2% per year. Since start of year, this index has gone up tremendously, more than 4%.
“This increase influences the price and the amount of money you will have to lay out in the first phase of the deal,” he says. “Therefore, bear in mind you will have additional costs, not only the purchase price. Please try to enquire up front, what are all the hidden costs? What else you will have to pay, such as purchase tax and other levies and taxes so you won’t be surprised or aggravated because of additional costs you did not expect up front.”
For additional tips and inquiries, Steinberg will be available to meet with prospective buyers at the Israel Real Estate Show.
The Israel Real Estate Show will be taking place on Sunday, November 14, in Brooklyn, New York, a unique event to be held in cooperation with Arutz Sheva.
The event will feature lectures and one-on-one meeting with a variety of experts, consultants and representatives of projects from all over Israel.