New Homes Hit Records – What's Happening in the Housing Market

In Q2 2026, Israel's real estate market showed mixed dynamics: total sales reached 22,640 apartments (-0.6% from the start of the year), but the primary segment grew by 18.4% (9,670 apartments), while the secondary segment fell by 11.3% (12,970). Nearly a third of new homes were purchased through government programs. Leaders: Tel Aviv-Yafo (1,236, +50%), Ashdod (+251%). Unsold inventory: 84,280 apartments.

In the second quarter of 2026, Israel's real estate market showed mixed dynamics. According to the Central Bureau of Statistics (CBS), total sales reached 22,640 apartments, 0.6% lower than at the start of the year. However, with seasonal adjustment, there was a quarterly increase in transactions of 14.9% and an annual increase of 11.7%, largely due to the low base effect: in June 2025, buyer activity nearly halted amid the war with Iran. The demand structure shifted toward new homes. From April to June, developers sold 9,670 new apartments—18.4% more than in the first quarter. New homes accounted for almost 43% of all transactions, with nearly a third of them under government subsidized purchase programs. The secondary sector contracted by 11.3% (12,970 units sold), though it still holds over 57% of the market. The average monthly growth in demand for new homes was about 2.7%. Tel Aviv-Yafo led new home sales with 1,236 apartments (+50% from the previous quarter). Ashdod saw a jump of 251% (509 deals), and Or Yehuda, Be'er Sheva, and Rehovot also grew. Declines were recorded in Netanya, Ofakim, and Rishon LeZion. In the secondary market, Jerusalem leads (808 deals), but even there the drop is over 23%. Exceptions: Harish and Modi'in. Despite the revival, developers hold a massive volume of unsold housing: by the end of June, companies had accumulated about 84,280 unsold apartments, equivalent to more than two years of work at current rates. Most of the inventory is in the Tel Aviv and Central districts, with Jerusalem and Tel Aviv-Yafo leading.