684 properties had been purchased in Jerusalem by overseas residents in 2025, in keeping with a survey revealed final week by the Ministry of Finance senior deputy to the chief economist Galit Ben Naim. In Tel Aviv overseas residents bought 186 properties final 12 months, in Netanya 169 properties and in Beit Shemesh 137 properties. That is no large shock. Jerusalem is taken into account a significant middle of demand for overseas residents, with buying an condo within the metropolis being seen not solely as an actual property funding but additionally as an id anchor.
Nonetheless, in latest months the image has begun to alter. The appreciation of the shekel towards the US greenback by about 20% because the starting of 2025 is dampening demand within the capital, and actual property brokers within the metropolis are reporting a slowdown in transactions, particularly in neighborhoods which are aimed toward overseas residents. All that is taking place whereas Jerusalem at present tops the record of recent unsold flats, and on the identical time, condo costs have begun to fall.
18% decline in purchases by Individuals in March-April 2026
The cooling in demand from US non-residents started changing into obvious firstly of 2026, however in latest months evidently the adverse pattern is gaining floor. Ministry of Finance information present that in March 2026 there was a rise within the variety of flats bought by Individuals in contrast with final 12 months (84 in comparison with 65), however on the identical time there was a lower within the relative share of Individuals in complete purchases by overseas residents, from 53% to 49%. The Ministry of Finance notes that one of many most important explanations for that is the weakening of the greenback towards the shekel, which affected the viability of transactions for Individuals.
The lower in demand for flats by overseas residents was significantly noticeable in Jerusalem. Greater than half of American purchases in Israel within the first quarter had been concentrated within the capital, however this can be a 5% lower in purchases in contrast with the identical interval final 12 months. The pattern worsened within the second quarter, when, in keeping with Ministry of Finance information, in March-April there was a pointy lower of 18% in American purchases in Jerusalem.
Past the dry numbers, actual property brokers and appraisers who function in Jerusalem additionally point out issue in gross sales to overseas residents within the capital. Lawyer and actual property appraiser Kobi Bir, whose actions give attention to Jerusalem, says that the strengthening of the shekel towards the greenback truly translated into a rise of about 20% in condo costs for US consumers. “There’s a clear sense of stagnation within the overseas resident market in Jerusalem. It is not that there was a growth right here earlier than, the battle additionally had its impact, however there isn’t any doubt that the weakening of the greenback has sharply curbed demand.”
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Alyssa Friedland, a luxurious condo dealer at Remax Hazon in Jerusalem, agrees with Bir: “Six months in the past I had 4 individuals occupied with a luxurious condo within the Talbiya neighborhood, priced at NIS 14 million. At the moment it is possibly one particular person each two weeks.” In accordance with her, the change would not solely have an effect on the luxurious section: The Baka neighborhood, which is taken into account widespread amongst overseas residents, can be seeing a decline in transactions. “At the moment, a lot of the transactions come from Israeli consumers, whereas overseas residents are merely sitting on the fence,” she provides.
Stagnation in shekels, costs rising in {dollars}
The decline in demand from overseas residents in Jerusalem comes at a very delicate time for the Jerusalem market, which is already beneath strain from excessive provide. Town at present tops the provision desk for brand new unsold flats, with over 10,000 flats awaiting consumers.
On the identical time, condo costs within the capital are additionally on a downward pattern. In accordance with information from the Central Bureau of Statistics, the worth of a median condo within the Jerusalem district reached a peak of about NIS 3.11 million on the finish of 2025, however within the first quarter of 2026 it fell by about 5.5% to NIS 2.94 million. In annual phrases, this can be a cumulative fall of about 20%. On this context, the Ministry of Finance survey exhibits that purchases by overseas residents in Jerusalem are primarily centered on excessive value ranges, with the median value within the first quarter being NIS 5.1 million.
In accordance with a survey performed by Matan Shitrit, Phoenix’s chief economist, from the attitude of the US purchaser, the hole between the worth of a median condo in shekels and its value in greenback phrases already stands at tens of %: “For the reason that finish of the primary half of 2024, the worth of a median condo in Israel, in keeping with the Central Bureau of Statistics, has remained nearly unchanged in nominal phrases. In actual phrases, by the way in which, there has already been a decline, and that is even earlier than bearing in mind the promotions and advantages that assist fairly just a few transactions out there,” explains Shitrit..
In distinction, he says, when these costs are transformed into {dollars}, a totally totally different image emerges – condo costs in Israel in greenback phrases have elevated by about 27%, because of the fast strengthening of the shekel along with the weakening of the greenback. “To place it into perspective, whereas the Israeli purchaser sees roughly the identical common value in entrance of them over the previous two years (about NIS 2.33 million), for a overseas resident the worth of a median condo in Israel has elevated from about $630,000 to about $790,000 in the identical interval. In different phrases, the Israeli residential market could appear stagnant in shekel phrases, however for overseas residents it has risen sharply in value.”
Printed by Globes, Israel enterprise information – en.globes.co.il – on July 6, 2026.
© Copyright of Globes Writer Itonut (1983) Ltd., 2026.
