17 MKs supported, ten opposed - and the amendment to the real estate taxation bill passed in the third reading in the Knesset plenum.
The vote on the proposal took place after all the reservations submitted on the subject were rejected.
According to the bill, which is included in the "large housing package" program presented at the end of last month by Finance Minister Avigdor Lieberman, Interior Minister Ayelet Shaked and Minister of Construction and Housing Zeev Elkin, the purchase tax rate on a second apartment will be raised to curb housing prices and reduce demand for apartments Investors.
The law was set as a temporary provision for three years, with the possibility of extension for another two years with the approval of the Finance Committee.
"The residential housing market is characterized by a rigid supply in the short term, without the possibility of adjusting the supply to changes in the demand for such apartments," the proposal said.
"Accordingly, changes in demand directly lead to an increase in apartment prices. Past data indicate that an increase in demand for residential apartments for investment produces 'excess demand' which comes at the expense of purchases of residential apartments by young couples. This increase in demand for residential apartments causes an increase in apartment prices. And pushes young couples out of the market. "
Ministers Elkin, Lieberman and Shaked at the presentation of the new housing plan, Photo: Oren Ben Hakon
Data from the Ministry of Finance showed that a reduction in the purchase tax rate in the previous amendment to the law led to a sharp increase in the number of residential apartments purchased for investment purposes.
The rate of purchases of residential apartments by investors since the reduction of the purchase tax has risen to about 20% of all transactions in the housing market, compared with a rate of about 13% of the number of transactions before the reduction.
According to the Central Bureau of Statistics' housing price index, there was a simultaneous acceleration in the rate of increase in housing prices, which led to the fact that last year since the reduction of the purchase tax rate in the period, between July 2020 and July 2021, there was a 2.9% increase in housing prices. Since 2010.
According to the new amendment, "In the sale of a right in real estate that is a residential apartment, for those who are not their only residential apartment, purchase tax will apply at a rate of 8% on the value up to NIS 5,843,565, and purchase tax at a rate of 10% on the value of this amount." .
MK Kish: "The law will harm the market and tenants"
According to the chairman of the Finance Committee, MK Alex Kushnir, who presented the proposal, "This tax increase will significantly reduce the amount of transactions carried out by investors and thus free up apartments for young couples. The next ones will bring a bill from the committee that will raise the tax brackets for the young couples who are purchasing the first apartment, thus giving them the opportunity to get closer to the apartment. "
MK Moshe Gafni also referred to the bill: "The Ministry of Finance brings various options for how it collects money from citizens, residents, especially the middle class and the weaker sections, and it wraps it in a shell of things we are all interested in.
The example that has now come by the Finance Committee to the Knesset plenum, lowering housing prices.
"How do you lower housing prices? They charge citizens money. They raise the purchase tax on a second apartment from 5% to 8%. In the past, when I was chairman of the committee, I raised it to 8% because of this claim that the Treasury came and said, Indeed it will lower the prices of apartments.
And things never were, the purchase tax went up and apartment prices did not go down.
"This reality is that people come and say that it will lower the prices of apartments, neither sexually nor in part."
MK Yoav Kish said that “the law will not achieve its purpose, it will hurt the market and hurt tenants.
After all, investors are not stupid, they see a finance minister sitting here who says that maybe if he succeeds, prices will rise by only another 6%.
"I do not know many returns today in the 6% market and that means investors will stay in this market, and what will happen is that in the end the cost of this tax will be passed on to the tenants who are the weakest in the food chain."
