This is how the light rail affects the real estate values ​​in Gush Dan

The light rail lines, whose work began five years ago, are expected to make residents of the Tel Aviv metropolitan area accessible to the employment center in Ramat Hachayal, to the university in the Ramat Aviv neighborhood and to the Herzliya Pituach, Holon and Rishon Lezion industrial areas, as well as to Jaffa, Bat Yam and Petah Tikva. An inspection conducted by Levy Yitzhak, editor of the apartment price list, shows that the light rail lines are expected to improve the value of the land in the neighborhoods where it will pass.

The examination shows that a two-room apartment on Carlebach Street in Tel Aviv, which in 2015 cost an average of NIS 2.1 million, is worth a sum of NIS 2.5 million in 2020 – an increase of 19%. A three-room apartment on the same street cost NIS 2.75 million five years ago, while today it is worth NIS 3.44 million – an increase of 25%. A four-room apartment then cost NIS 3.53 million and is now worth NIS 4.2 million – an increase of 19%.

On Arlozorov Street, where work is set to begin soon, a three-room apartment in 2015 cost about NIS 2.9 million. Today, the price is already NIS 3.5 million – 21%. While on Ibn Gvirol Street, the price of a three-room apartment was NIS 2.77 million in 2015, while today the price is NIS 3.25 million – an increase of 17%.

In the south of the city, in the Neve Sha’anan neighborhood, for example, there have been larger jumps. Thus, in 2015, the price of a three-room apartment was NIS 1.25 million, while today a similar apartment costs NIS 1.9 million, a 52% jump in price. On Lewinsky Street, not far from the new central station, a two-room apartment cost NIS 1.09 million five years ago, while today it is worth NIS 1.5 million – an increase of 38%.

In the new part of Lewinsky Street, closer to the Florentine neighborhood, a three-room apartment cost NIS 1.75 million five years ago. Today it is worth NIS 2.35 million – an increase of 34%. In the defense complex, a three-room apartment cost about NIS 1.11 million five years ago, and today it is offered at a price of NIS 1.5 million – an increase of 35%.

Yitzhak points out that one of the advantages of building the light rail is its potential for attracting a new population to the neighborhoods in which it passes. “The entry of a population with a high socio-economic level, who would like to enjoy the transport accessibility that the light rail will allow, will also increase the value of the land in the area and mark it as a lucrative migration route for others,” he says.

For example, in the Jaffa and Jaffa D neighborhoods, where apartment prices have climbed in the last five years: “These are neighborhoods within walking distance of the beach and, of course, places near the light rail. Although these are old buildings, characterized by a relatively weak population, in the long run A chance for a high improvement in the assets. “

According to the survey, the price of a three-room apartment in the Jaffa III neighborhood, for example, in 2015 was NIS 900,000. Today, such an apartment will cost NIS 1.32 million – a jump of 47%. In the Jaffa D. neighborhood, a three-room apartment cost NIS 870,000 five years ago, while today it is sold for NIS 1.4 million – a jump of no less than 61%.

If you ask real estate appraiser Erez Cohen, the consequences of the light rail are also expected to reduce the gaps between apartment prices in north Tel Aviv and the south. “The lower the real estate value, the higher the chance of significant improvement,” he says. “It is clear that the improvement in the northern part of the Green Line, the Ibn Gvirol area and north, will be more modest compared to the improvement in its southern section, which comes from Holon to the south. Tel Aviv. The same goes for the purple line, in the section that will cross the new central station next to the Hatikva neighborhood and southeast of Tel Aviv. “

As for the areas of North Tel Aviv and the neighborhoods beyond the Yarkon, where the northern section of the green line of the light rail will pass, according to Cohen, a more moderate improvement is expected. “Complexes where land values ​​are currently estimated at NIS 55,000-50,000 per square meter will be fixed in the direction of NIS 60,000 per square meter,” he says. Tali Sharon, VP of Marketing and Sales at the Ram Aderet Haboneh Group in the Ramat Hachayal neighborhood, adds that “as we get closer to the opening date of the line, the demand for apartments built and built near the light rail stations will increase. This means that anyone who is currently buying an apartment in a project near the light rail line is expected to enjoy an increase in the value of the property. “

Price increases can also be seen in the neighborhoods in Givatayim, near the Arlozorov station in Tel Aviv, which are expected to enjoy additional property improvements over those they have absorbed in the past five years. An examination by Yitzhak shows that a three-room apartment in the neighborhoods near the Shalom Interchange cost about NIS 1.7 million in 2015, and today the price is NIS 2.1 million – an increase of 24%. A four-room apartment cost NIS 2.4 million five years ago, and today the average price is NIS 2.9 million – an increase of 21%. While the price of a five-room apartment in the area in 2015 was NIS 3.1 million, while today the price is NIS 3.6 million – an increase of 16%.

The neighborhoods in Ramat Gan are also expected to be affected by the light rail, especially the purple line, which will pass through the Aluf Sadeh interchange. In fact, says Yitzhak, the light rail will allow greater accessibility between the two parts of the city, separated by Road 4 (the new Krinitzi neighborhood and the Tel Hashomer area, Ramat Efal and Kfar Azar). According to him, the southeastern neighborhoods, bordering Road 4 west – Ramat HaShikma, Ramat Amidar and Neve Yehoshua – which are considered neighborhoods where apartment prices are at least 20% lower than the real average price in the city, have not yet internalized the expected increase following the light rail, but according to him, price increases are expected later.

According to the survey, if a two-room apartment on Jabotinsky Street in the city cost about NIS 1.32 million in 2015, today the price of such an apartment is NIS 1.7 million – a jump of 29%. A four-room apartment on the same street cost NIS 2.66 million five years ago, and today it costs NIS 3.1 million – an increase of 17%.

On Bialik Street, the price of a three-room apartment in 2015 was NIS 1.48 million, while in 2020 the price was NIS 2 million – a 35% jump. In the eastern part of the city, in the Tel Hashomer area, a four-room apartment cost NIS 2.2 million five years ago. Today, the price of such an apartment is NIS 2.5 million – an increase of 14%.

In the Neve Yehoshua neighborhood, which as mentioned has not yet been significantly affected by the consequences of the light rail, the price of a three-room apartment in 2015 was NIS 1.43 million, compared to the current price of NIS 1.65 million – an increase of 15%. A four-room apartment in the same neighborhood cost NIS 1.55 million five years ago and today NIS 1.8 million – an increase of 16%.

As for Bat Yam, this has to some extent internalized the consequences of the light rail, and apartment prices have climbed in recent years, not just in the new neighborhoods near the beach. The light rail will bring Bat Yam closer to Tel Aviv, to which can be added the old and neglected industrial area, which is currently changing its face and is expected to include a mix of uses with thousands of planned housing units, which will be accessible to the red line of the light rail.

“The prices of apartments in the area will climb as the construction of the train progresses,” says Yitzhak. “It is likely that new residents of medium and above socio-economic level will enter the city, who will be happy to live in an accessible business district and high-tech, close to the light rail and the sea.” According to the survey, a three-room apartment in the Yoseftal neighborhood in the city cost NIS 923,000 five years ago, while today the price of such an apartment is NIS 1.3 million – a jump of 41%. In the Bar Ilan neighborhood of the city, the price of a two-room apartment in 2015 was NIS 845,000, compared to the current NIS 1.13 million – an increase of 38%.

Idan Siegel, VP of Marketing at Ashtrom Properties, a construction company in the city, notes that “the red line of the light rail, along with a metro line, is expected to significantly shorten the arrival times for employment and commercial centers in Tel Aviv and the surrounding area. This is why it is a city that is becoming an attractive destination for buyers. “Transport accessibility contributes to this, but so does a green network consisting of paths and public areas, which create pedestrian connectivity in the Yoseftal complex.”

According to Avi Zeituni, CEO and owner of A. Zeituni, a construction company also in the city, “As the date of the light rail approaches, the issue of the station’s location is a consideration in choosing the apartment area. This way you can give up one vehicle and save on maintenance costs. In my opinion, the increase in the value of properties in the city will be reflected mainly with the opening of the first line, to the point of reducing the gap between the prices of apartments near the sea in Bat Yam compared to the apartments near the sea in Tel Aviv. “

The city of Holon, which has developed greatly in recent years, is also expected to be improved in complexes adjacent to the light rail. The inspection shows that a three-room apartment on Histadrut Street cost NIS 1.18 million five years ago, while today it is worth NIS 1.4 million – an increase of 19%. A four-room apartment on the same street cost NIS 1.61 million in 2015, while today it is worth NIS 1.8 million – an increase of 12%. A three-room apartment on Sokolov Street cost NIS 1.15 million five years ago, while today it costs NIS 1.4 million – an increase of 22%.

Some of the neighborhoods in Petah Tikva are also expected to undergo property improvements. The examination shows that the price of a three-room apartment in the Neve Gan neighborhood was NIS 1.5 million in 2015, while today the price is NIS 1.8 million – an increase of 20%. A four-room apartment in the same neighborhood cost NIS 1.7 million five years ago, while today its value is NIS 2.1 million – an increase of 24%. A five-room apartment in the neighborhood cost 1.8 million five years ago, and today it is worth NIS 2.28 million – an increase of 27%. In the city center, the price of four-room apartments was NIS 1.57 million, and today it is worth NIS 1.95 million – an increase of about 25%.

Despite the price increases, it should be taken into account that there are negative elements resulting from the works that last for many years, such as air pollution, noise and traffic jams. “Most short-term property damage due to the works themselves, as well as long-term depreciation due to the tracks and stations themselves. The light rail – that is, in properties adjacent to the line itself, “explains Adv. Roi Amzel of the Real Estate and Planning and Construction Department at the firm of Adv. Nashitz Brands Amir & Co. He said,” While the second circle enjoys accessibility, commercial properties adjacent to tracks and stations may be almost lacking. Use during the execution of the works “.

An example of this is provided by Adv. Amzel regarding a commercial property at a central meeting on Ben Yehuda Street, which remained in short supply in the shadow of a temporary seizure of its facade for the purpose of carrying out the works, and the denial of the possibility of placing desks there. “In the long run. “Another property that is experiencing a similar problem is an old office building on Ibn Gvirol Street, which during the works the parking lot where it will probably remain blocked to traffic, and therefore unused. “Even in the long run, an underground expropriation is expected, which will reduce the number of parking spaces there permanently.”

Adv. Eli Wilczyk from the law firm of Cohen Wilczyk & Co. also says that although the real estate values ​​around the light rail are climbing, it is impossible to ignore the nearby properties that were damaged by the works. He provides an example of this with the Samuel Jacobs Hotel. On Dizengoff Street, corner of Arlozorov. “According to the original plan of the light rail, the area on which the hotel is built, the basement and the balconies were expropriated in favor of the train, but the building permit was granted before the details of the plan were revealed. The hotel has been open for half a year, and one bright day it turned out that part of it was exaggerated. ” .

Another example provided by Adv. Wilczyk refers to a residential property on Ben Yehuda Street, for which an application for a building permit was submitted. “The permit was obtained, and then it became clear that road works were expected, which meant that parking could not be built on the project.” The property – although there is a light rail next to it. Some of the balconies were also expropriated, and we had to reach arrangements for them. We have filed a claim for impairment, and it is still under discussion. “