Even though the Israeli real estate market has barely taken a hit in the current economic slowdown, Israeli consumer confidence has. That must be a reason to explain why fewer and fewer Israeli’s are looking to make real estate purchases.

According to Globes: “The economic uncertainty has caused Israelis to defer dreams of buying a first apartment or moving to a new one. In April, 6.6% of Israelis said that they planned to buy a new or second-hand apartment in the next six months, compared with 7% of Israelis in March, according to the Consumer Confidence Index, compiled by Globes Research and Kesselman and Kesselman - PricewaterhouseCoopers Israel. This is the lowest level since January 2009, and before that - in January 2006.

The low level of planned home purchases in April is unexpected, since the Consumer Confidence Index jumped in April to 76.1 points, its level before the collapse of Lehman Brothers in September 2008.”

Let’s see if this lower demand will translate into lower home prices.

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Brian Buffini, a wel regarded real estate guru in the US, recently said that “Israel is turning out to be a prime real estate destination.”

According to Ynet: “Considered an industry guru, Buffini owns the biggest real estate and business coaching and training company in the US. He arrived in Israel recently to lecture to local real estate agents.

The business of real estate, he told his listeners, can thrive even in these troubled times. Buffini’s teachings advocate using networking and existing business contact, rather than costly advertising, to drum up business.

Realtors, he said, must take the time and invest in creating personal relationships: Every person, on average, knows about 285 people, so if you invest in cultivating 100 relationships, you can increase you potential cliental by 28,500 people.

The US real estate market, left nearly crippled by the financial crisis in the States, is slowly recovering, said Buffini. He recommended Israelis looking to invest in real estate invest in the local market, but if you have your heart set on an American venture, he recommended looking into property in California, Florida and Michigan, as well as in Las Vegas, Nevada and Phoenix, Arizona.”

This is certainly a seal of approval with regards to the Israeli real estate market.

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Nothing like investing in real estate at a market high with a lot of leverage. Just ask former Israel billionaire Lev Leviev, as he continues his fire-sale of property to raise cash to help pay down his debts.

According to Globes: “Africa-Israel chairman Lev Leviev is continuing the sell-off of properties. Africa-Israel Investments Ltd. (TASE:AFIL) subsidiary Africa-Israel Properties Ltd.AFPR) has signed an memorandum of understanding (MOU) to sell 95% and half of the unused building rights of the Africa-Israel Tower in Tel Aviv to a group of foreign buyers for NIS 166.5 million. (TASE:

The company did not disclose the identity of the buyer.”

Let’s hope he is able to sell off enough properties to pay off bondholders.

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In the face of global chaos, Israeli real estate prices still found a way to go up over 10% for 2008.  While most of the gains came in the first 3/4 of the year, prices have gone up even more in places like Petach Tikva and Modiin, both with yearly price gains of over 20%.

From Globes:

Tel Aviv suburb Petach Tikva led the price rise in 2008 with the average apartment climbing 22% in price to NIS 856,000 last year. In second place was Modi’in where the price of the average apartment rose 21% to NIS 1,031,00. The average apartment in Rishon Lezion and Yavne rose by 17% to NIS 926,000 and NIS 587,000 respectively. The average apartment in Givat Ze’ev recorded a 16% rise to NIS 852,000. Prices rose 15% in Ramat Gan to NIS 1,037,000 and 14% in Tel Aviv to NIS 1,214,000. The average apartment price in Mevasseret Zion rose by 14% in 2008 to NIS 1,218,000 and by 10% in Jerusalem to NIS 1,060,000.

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