Israel's residential real estate sector saw a 28% jump year-on-year in transactions in May, according to a report published by the Finance Ministry’s Chief Economist's Division on Wednesday, and an 8% increase compared to April’s data.
The Finance Ministry noted the rate of increase in transactions in May was moderate compared to April’s figures, though it was still higher than growth rates recorded in the first three months of 2024.
Without counting sales under government subsidy programs, the number of real estate transactions in the open market stood at 7,258 housing units — a 30% increase year-on-year and a moderate increase of 7% compared to April.
A historical comparison of the number of transactions on the open market during May, since the early 2000s shows that the month ranks in the lower third in purchases. The market share of new apartments ranked fourth in this comparison, while second-hand apartment sales reached a low point.
Contractor sales totaled 3,640 apartments, including government-subsidized apartments — marking a 60% hike year-on-year. A 12% was seen compared to April. The Finance Ministry explained this was a moderate growth rate given the few working days in April due to the Passover holiday.
On the open market, without counting sales under government subsidies, apartment sales saw a surge of 76% compared to May 2023 and an 11% increase compared to the previous month.
Sales of second-hand apartments totaled 4,268 units, seeing a 10% increase compared to May of last year and a 5% increase compared to April. The increase in the number of second-hand transactions wasn’t geographically uniform, with the Tel Aviv area and northern regions (Haifa, Tiberias, and Nazareth) recording a decrease in sales.
Investor purchases amounted to 1,297 apartments — marking a sharp 38% increase year-on-year and a 10% increase compared to April. This is still a relatively low level of purchases, with a sharp 33% decrease compared to May 2022. Investor market share stood at 16%, one percentage point higher year-on-year and unchanged compared to April.
Foreign investment purchases totaled 156 apartments, seeing a 15%-16% increase compared to the previous month and May of last year. These purchases were concentrated, as in previous months, in the Jerusalem area (about 70% of total foreign purchases).
Meanwhile, Foreign investors also sold 39 apartments, resulting in a net total of 117 apartments purchased, a significantly lower number than estimates made by industry officials since the outbreak of the war in Gaza.
Investor apartment purchases totaled only 997 apartments, a 24% decrease year-on-year and 21% less compared to April.
First-time homebuyer purchases totaled 4,626 apartments, including government-subsidized units, marking a sharp 46% increase compared to May of last year and 12% compared to April. Excluding government-subsidized purchases, first-time homebuyer purchases totaled 3,976 apartments, a surge of 53% year-on-year a 12% increase compared to April.
Purchases by people looking for larger homes totaled 1,986 apartments, marking a 3% decrease year-on-year and compared to April 2024. This was the only market share that recorded a purchase decrease in May.