Israel Ranked Most Expensive Place To Buy In European Region
Israel was the most expensive country in which to buy a home in the European region in 2022, according to a new report by financial advisory company Deloitte. Israel joined Deloitte’s latest Property Index of European residential markets, published in recent days, despite not being a part of Europe, and immediately shot to the top of the priciness table, with an average cost of €5,701 (NIS 23,537; $6,204) per square meter. Israel is the only real estate market based in the Middle East to be included in the survey of a total of 27 countries. Other countries, including Estonia, Greece, and Lithuania also joined the survey. The second most expensive country for a second year in a row was Austria, where the average transaction price for new dwellings stood at €4,925 per sqm, followed by Germany with a price tag of €4,800 ($5,200) per sqm. France and Norway, with prices of €4,639 per sqm and €4,204 per sqm respectively, completed the list of the top five most expensive countries to buy a home in 2022. The most affordable country to buy residential property was Bosnia and Herzegovina, where an average transaction price for new dwellings of €1,237 per sqm was recorded. This was followed by Greece with an average transaction price of €1,330 per sqm. Romania with a price tag of €1,417 per sqm was ranked in third place in terms of the lowest level of transaction prices. Comparing residential property markets in 76 cities, Tel Aviv replaced Paris as the most expensive city in Europe to buy a square meter of apartment in 2022, according to the findings of the accounting firm’s annual survey. The average price of a new dwelling in Tel Aviv was €14,740 per sqm, followed by Paris at €14,622 and Munich at €11,400, with London at €9,163 and Amsterdam at €7,775 ranked far behind. The accounting firm cited the war in Ukraine and rapid increases in energy costs, building material prices, and interest rates as the main reasons that average transaction prices of new dwellings rose over the past year. Over the past year, the Bank of Israel has steadily hiked the benchmark interest rate from a record low of 0.1% in April 2022 to 4.75% in May this year in a bid to rein in inflation, while raising mortgage costs for homebuyers. As a result, home prices, which jumped by a record of about 20% in 2022 year-on-year, have started to cool down in recent months. That’s as rising interest rates hit existing and potential mortgage borrowers hard, with the majority of home loans in Israel tied to variable rates. At the same time, the amount of equity required to purchase a home keeps rising, and with it, the affordability gap is widening. The report estimated that in Israel a 70-square-meter home cost the equivalent of 10.2 years gross annual salaries on average. By that measure, Israel was the fifth-costliest country in which to buy a new home, after Slovakia, the Czech Republic, Serbia, and Estonia. Israel was also ranked at the top of the list of countries with the highest number of initiated dwellings, with 6.95 construction starts per 1,000 inhabitants in 2022. This was followed by Austria and Lithuania with 6.47 and 5.81 new housing initiated per 1,000 inhabitants, respectively. Meanwhile, Israel has the second-lowest amount of housing stock with 295 dwelling units per 1,000 inhabitants, topped only by Greece with 285 units per 1,000 inhabitants. The average amount of housing stock was 473 dwellings per 1,000 inhabitants in the European region. Bulgaria had the most housing stock per capita, with 624 dwellings per 1,000 inhabitants. Portugal and France came next with 585 and 552 respectively. In the report it was noted that the size of the total housing stock is often perceived as a key indicator of the quality of life and level of economic development in those countries.
Tags : Israel most expensive country buy home European region financial advisory company Deloitte Property Index residential markets real estate market Middle East Austria Germany France Norway