In February, Israel's consumer price index slightly exceeded forecasts, rising by 0.2%. This increase was primarily driven by the housing services ownership category, which rose by 0.4% compared to January. Despite a continued decline in apartment prices due to an oversupply and decreasing demand, this category contributed to a third of the total monthly index increase. The Israeli real estate market is characterized by an abundance of new constructions, with over 250,000 housing units approved by 2025, and declining demand due to political and economic instability. Interest rates are not expected to decrease in the near future, which may continue to put downward pressure on real estate prices while increasing rents due to reduced investment in rental properties.
