The building stands on three things Israel today

Increasing building rights by 30%, allocating 20% ​​to eligible people, allocating 10% for long-term rent - this will solve the housing crisis

• Unlike in the world, only a few Israelis choose long-term rentals

  Photography: 

  Envato Elements

Produced by the Department of Special Supplements

We were recently informed that the Azrieli Group is promoting a number of veteran projects, which it is converting into rental housing, including Hostel Avraham on Levontin Street in Tel Aviv.

This is actually the first time a leading real estate group has announced in a wavy brush that it sees rental housing as a required product.

However, this is a large hall, the ball is in the hands of the Israeli government and in particular by the Minister of Housing, Rabbi Yaakov Litzman.

Unlike the well-known Christian trinity - the Father, the Son and the Holy Spirit, the Minister of Housing would do well to promote in 2021 the winning trinity that I have long proposed:

1. Automatically increase by 30% the building rights in any project that will be built in the area of ​​demand, thus significantly increasing the supply of housing already during the coming year.

2. In each project, in exchange for increasing the building rights, 20% will be allocated for the benefit of those entitled, who will be sold at a significant discount, thus constituting an excellent alternative to a failed tenant price plan.

3. Entrepreneurs will be allocated 10% that they can rent for the long term, and thus the rental model will also be worthwhile for them.

In the State of Israel, a long-term strategic solution will finally be created through rental housing.

It is no secret that rental housing has been a diligent failure over the years.

The reasons for this were varied, some rational, some clearly psychological.

Compared to the reformed Western countries, the percentage of Israelis living in long-term rent, by choice, is small.

The vast majority of tenants are relatively young, unable to purchase an apartment.

Even the government project, an apartment for rent, is still relatively niche.

Well, what exactly are the reasons for the failure of rental housing in the State of Israel, and is the crossroads of the housing crisis, a minority in construction starts and high prices, a desirable formula for leveraging long-term rental housing, as is common in many countries around the world?

Psychology, history and economics

First, on the psychological and mental level, the people of Israel, who wandered in the Diaspora for 2,000 years and felt no deep roots anywhere, felt that buying their own apartment to live in the Land of Israel was an integral part of realizing the Zionist vision.

In the same matter: in a new country of immigration all over the world, the purchase of a residential property becomes an integral part of the status of the immigrant, and in our case the new immigrant, thus positioning himself as an integral part of society in the new place.

Third, it is important to remember that for many years low-income families lived in subsidized public housing, such as Amidar, which significantly increased the tenants' sense of security.

In the 1980s, for example, more than 80% lived in their own apartment or in sheltered and subsidized public housing.

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Fourth, even on a practical level, especially in the 50s and 60s of the last century, when the standard of living was immeasurably low, buying an apartment was a much easier task than today.

If today it is at least about 20 years 'salary, 60 years ago it was, unbelievably, only about 4 years' salary, not to mention thousands of apartments with key fees that were common in those days.

Fifth, mortgages and government assistance in those days, even through public housing companies, often covered a very significant part of the financing of the purchase of the apartment.

Whether it is mortgages that were not linked to the consumer price index in an era of soaring inflation, supplementary mortgages, conditional grants for those who agreed to move to the periphery and more.

Sixth, and this is a very interesting point, the incessant rise in housing prices, which has become a double-edged sword for the homeless, was actually a strength for the homeowners, who saw improving their value as an excellent economic investment and not just a mere residential apartment.

Of the celebrities, one of the most prominent topics in Friday night conversations was (and still is) "how much I have earned on the apartment since I purchased it."

In conclusion, as I suggested above, only the allocation of 10% of the apartments will be able to turn the bowl upside down and make the rental housing an integral part of the housing market in the State of Israel.

The ball, of course, is in the hands of the Israeli government and Rabbi Litzman.

Produced by the Department of Special Supplements