Director General of the Ministry of Construction: apartments will continue to become cheaper - in Israel they are building more than needed
Director General of the Ministry of Construction Yehuda Morgenstern predicted a further decline in apartment prices in Israel, noting that construction volumes exceed the annual demand. He criticized developers for inflating prices at land auctions. Industry representatives warned of a risk of reduced supply due to expensive loans and low profitability.
Director General of the Ministry of Construction of Israel Yehuda Morgenstern stated that apartment prices will continue to decline in the coming years, but a sharp collapse is not expected. Speaking on November 4 at a contractors' conference in Eilat, he noted that construction volumes exceed annual demand: in 2024, construction of about 70,000 apartments began, in 2025 approximately 80,000, and 2026 will end with a figure of about 78,000, with an annual demand of 60,000–65,000 apartments. Morgenstern criticized developers for inflating prices at land auctions, urging them to bid less for land to reduce the final price for the buyer. Industry and banking representatives warned that high financing costs and low profitability hinder the launch of new projects. Chairman of the Contractors' Association Amit Gotlib warned of a risk of a new gap between supply and demand and criticized the financing model for the metro in Gush Dan. Morgenstern acknowledged the long-term rental policy of the last decade as unsuccessful.