How much will a 100 sq.m. apartment in Rishon LeZion cost?

Against the background of the criticism of the low volume of state land marketing for the construction of new apartments in the past year: The Ministry of Construction and Housing and the Israel Land Authority (RMI) reported today (Sunday), at the beginning of the new civil year, the completion of seven tenders for the construction of 4,237 new housing units. For comparison, by the beginning of December 2020, tenders were closed for the construction of only 14,000 apartments.

Recall that as part of a housing program at a reduced price, a maximum price per square meter method and a minimum price per square meter were set. The winner is selected according to a two-stage test: in the first stage, the person who offered the lowest price per square meter is selected. In the second stage, from the person who offered the lowest price, which is the minimum, the bid of the person who offered the highest addition on the land was selected. most.

The Ministry of Housing notes that in many of the tenders closed so far, an addition was given to the reduced consideration for the land, so that a maximum discount was given to the tenants and a consideration was received for the land higher than the full land value according to assessment (before discount). It should be noted that not all the apartments in the auction will be sold at a reduced price, but 50% of them. The rest will be sold by the developers at free market prices.

In Rishon Lezion, a tender was completed for the construction of 818 apartments in the Norit neighborhood. As stated, half of the apartments will be sold using a reduced housing method at a starting price of NIS 1,458,054 for an 85-square-meter apartment (which includes about three rooms). A 100-square-meter apartment (which includes about four rooms) will be sold starting at NIS 1,693,224 million. The amounts embody a discount of about 18% of the prices of apartments in the free market.

In Ramat Gan, a tender was completed for the construction of 833 apartments, half of which will be sold using a reduced housing method at a starting price of NIS 1,552,824 for an 85-square-meter apartment. A 100-square-meter apartment will be sold starting at NIS 1,798,524. The amounts embody a discount of about 21% of similar apartment prices in the free market.

In Lod, a tender was completed for the construction of 343 apartments, half of which will be sold using a reduced housing method at a starting price of NIS 976,739 for an 85-square-meter apartment. A 100-square-meter apartment will be sold starting at NIS 1,132,934. The amounts embody a discount of about 28% of similar apartment prices in the free market.

In Nazareth, a tender was completed for the construction of 179 apartments in the Galilee neighborhood, half of which will be sold using a reduced housing method at a starting price of NIS 610,878 for an 85-square-meter apartment. A 100-square-meter apartment will be sold starting at NIS 717,933. The amounts embody a discount of about 38% of similar apartment prices in the free market in the city. In addition, a grant of NIS 60,000 will be given to buyers.

In Ma’ale Adumim, a tender was completed for the construction of 18 apartments, half of which will be sold at a discount. The starting price for an 85-square-meter apartment will be NIS 1,305,969, and a 100-square-meter apartment will start at NIS 1,508,759. The amounts embody a discount of about 10% on similar apartment prices in the free market.

As part of the “plan and build” method, the winning company is responsible for the planning, development and construction of all the apartments and buildings in the neighborhood within a pre-determined period of time (about 40 months) in large neighborhoods that include more than 1,000 apartments. This is in order to allow buyers to enter a “ready” neighborhood both in terms of housing units and in terms of infrastructure. At the end of 2017, Shafir won a tender in this method using this method.

In Beit Shemesh, a tender was completed for the construction of 1,036 apartments using the “plan and build” method in the Ramat Beit Shemesh D5 neighborhood (intended mainly for the ultra-Orthodox sector), of which 820 apartments will be built as part of saturated construction (for height). About 50% of all apartments will be sold at a reduced price. In other words, this is a starting price of NIS 1,099,054 for an 85-square-meter apartment and a starting price of NIS 1,274,063 for a 100-square-meter apartment. The amounts embody a discount of about 15% on similar apartment prices in the free market. The winning company is a company path for building and investing.

In Sderot, a tender was completed for the construction of 1,010 apartments in the Bustanim complex, half of which will be sold at a reduced price. This is a starting price of NIS 611,107 for an 85-square-meter apartment and a starting price of NIS 719,760 for a 100-square-meter apartment. The amounts embody a discount of about 23% of similar apartment prices in the free market in the city. In addition, a grant of NIS 60,000 will be given to buyers. The winning company is Asom Building Contracting Company.

Recall that recently reduced price tenders were completed in Ofakim, Eilat and Bnei Brak. In the cities of Beersheba and Tiberias, the state was unable to complete the tenders after no bids were submitted by developers or the bids submitted were not valid. To date, the Israel Land Authority has issued about 45 reduced housing tenders, some of which have not yet been completed, for example in Haifa and Ashkelon, and as stated, some have not been successful. Most of them were originally intended for a price-per-tenant track and were converted to the new program.

In Bnei Brak, Arazi Hanegev won 413 apartments in two complexes, of which 70% of the apartments will be sold at a reduced price. An 85-square-meter apartment will be sold starting at NIS 1,322,042 and a 100-square-meter apartment starting at NIS 1,535,274. The amounts reflect a discount of 24% on similar apartment prices in the free market.

In Ofakim, the Megiddo Group won a tender for the construction of 145 apartments, and Chai Rafael Entrepreneurship and Construction won a tender for the construction of 84 apartments in the Afiki Nahal neighborhood. Two other complexes on Ofakim did not receive any offers. Apartment prices will be between NIS 6,078-6,218 per square meter.

In Eilat, a tender was completed for the construction of two residential complexes in the Sadeh district, which was used by the municipal airport, in which 645 apartments will be built by the Ozen brothers (which will build 275 housing units) and Eyal Peretz Entrepreneurship and Real Estate (which will build 140 housing units). Free and 30% at a reduced price in the amount that gives a discount of 35%. A 100 sqm apartment will be sold starting at NIS 1 million. Another tender for 200 apartments was not completed after no bids were submitted.

Sources in the real estate industry criticized the reduced housing plan, claiming that it is a plan that provides smaller discounts than the previous plan, which may make it difficult for those eligible to purchase apartments. Regarding the completed tender in Bnei Brak, it was criticized that it should not be in the demand area. Part of the reduced housing system, despite approval to promote the tender for an audience with an ultra-Orthodox character – the sector that votes for the Minister of Housing. In response to Ynet’s request, Ynet explained that at the last Israel Land Council meeting, the price threshold dropped from NIS 22,000 per square meter. NIS 20,000 per square meter, which made it possible to hold the tender in Bnei Brak.

Last week, the Ministry of Housing reported the completion of 26 additional state tenders for the construction of 9,100 apartments, some of them free market tenders. In doing so, the state opened the planning stopper in an attempt to move toward its marketing goal. Among other things, three tenders were completed in Be’er Sheva for the construction of 111 apartments in the Park neighborhood, 454 apartments in the Sigaliot neighborhood and 523 apartments in the Park neighborhood. In Ashkelon, a tender was completed for the construction of 180 apartments; In Arad, a tender was completed for the construction of 89 apartments; In Sderot for 100 apartments; In Jessar A. Zarqa for 108 apartments; In Givat Zeev for 552 apartments; In Yeruham for 82 apartments; In Netivot for 96 apartments; In Petah Tikva for 44 apartments; In Kiryat Bialik for 1,214 apartments; In Ramat Gan for 340 apartments; In the village of Manda for 176 apartments and in Moshav Ahuzam in the south for 38 apartments.

Yair Pines, Director General of the Ministry of Construction and Housing, said: “The tremendous success of reduced price tenders is a critical first step in reviving the real estate industry in Israel. The Ministry of Construction and Housing and the Israel Land Authority will continue to market more tenders Growth of the Israeli economy. “