The Israeli real estate market is highly diverse, and with each passing year it develops in new surprising directions that should interest any potential investor. Interested in the Israeli real estate market? Then you should know about the different options offering good returns spread throughout Israel. A law firm proficient in this field and specializing in real estate can provide you not only with the knowledge you require to carry out such an investment, but also execute in your name and on your behalf feasibility and financial strength audits of any such real estate project, and guide you both legally and contractually until its successful completion.
The Israeli government decided to allow tenants and various real estate entrepreneurs renovate old buildings in densely built urban environments that do not allow for other construction, for various reasons. First of all, the buildings are old and do not meet the required earthquake standards, and also do not have apartmental protected spaces, as required due to Israel's security situation. The renovation of such buildings is also an opportunity to draw young people looking for large, upgraded apartments, and therefore it also strengthens communities. Investment in such projects also includes investment in infrastructure and environmental development.
Urban renewal projects
Two urban renewal plans, under Town Building Plan 38, offer real estate developers great opportunities to make a profit. In some of these, you can receive building rights for additional floors, so that you can add apartments to the renewed building; in others, the apartments are simply enlarged and improved, together with different additions and benefits such as parking lots and better shared public areas. Such buildings can be found mainly in old neighborhoods, and in some of them, you can convince tenants and collect signatures in order to carry out the renewal project. This field in particular requires legal advice, since you are dealing with groups of tenants who are subject to certain laws regarding their agreement to the project, and therefore, legal advice is crucial.
Locating lands for construction and planning and building single-family detached homes
In many cities, you can no longer find unoccupied land for construction. Most of this land is found in peripheral towns or rural communities, where the zoning designation is changed. Are you interested in the Israeli real estate market? You should look for projects you can control from the stage of locating the land to the receipt of the certificate of completion. In such projects, you can buy land that was released for construction, in a certain municipality, and plan and build several single-family detached homes with high quality specifications and high quality construction. Your profit from such construction is guaranteed. These real estate developments do not necessarily have to include several homes. You can also build just one home over a large, special-purpose plot, and price it accordingly. However, such homes can only be built in rural areas, and at present, we know that such lands' prices rise with each passing year because private developers find them so attractive.
Investment in real estate funds
If you do not know Israel well enough to know where you should invest, let experts manage your funds by investing in real estate funds. This way, you can ensure your investments are diversified and guarantee your profit. The real estate market is almost never static, which means there is always the latest real estate opportunity to find.
Are you interested in the Israeli real estate market? This is your way of getting to know it. Such an investment offers you the opportunity to invest directly through the fund in multiple participation units. In this way, you can minimize your risk on the one hand, while increasing your chances of making a profit, on the other hand.
Why are peripheral regions such a hit at the moment?
Right now, the hit is the periphery, for several good reasons. In recent years, the Ministry of Transportation is doing its utmost to bring the periphery closer to the center, through the railway grid that keeps expanding. In addition, roads being paved throughout Israel, including fast new interchanges, and especially the further development of Highway 6, have made traveling these distances easier. Various examples of blooming real estate opportunities include: Yeruham, the city of residence of officers from the IDF training base city; Beer Sheva, where Neighborhood D is starting to achieve new peaks in apartment prices and different returns; the Ashkelon and Gaza envelope region, where people are flocking despite the security situation, thanks to its natural beauty; and Ashdod, which is yet to reach peak prices, although it is fast getting there thanks to international investors.
Luxury properties, shared work spaces and offices
Are you interested in the Israeli real estate market? Here are two more fields where you can make a profit – the luxury apartment and office markets. When you invest in luxury properties, one thing is certain – even if the property's value does not increase dramatically over the years, it will eventually repay your investment through your monthly rent returns; although it is reasonable to assume that its value will also rise, since that is natural with luxury properties, especially those with the right location. In addition, consider investing in offices and especially office buildings with modern operation that appeal to young developers, such as shared work spaces which are also designed for networking.
This is the future as it is forming at the present, presenting myriad opportunities and still open to innovation and investment. Offices, naturally, generate a return through leasing, and with offices too you must know where you should invest and what areas are of special interest. At present, there is also demand for offices rented by the hour or by the day, making this an especially attractive field. In any case, it is not recommended to take any steps without a lawyer to conduct negotiations, check all risks and financial feasibility, and examine the relevant history and approvals of the property, as well as prepare contracts and make bank transfers and look into all legal and judicial aspects of the prospective investment and property.
Eli Shimony - Israeli law firm representing clients on all civil/commercial legal issues in Israel. For any questions please contact us and we will be happy to assist.
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The above article is a general information only and it is not intended to replace a legal advice.