The Israeli real estate market is facing a paradoxical situation where, despite a significant increase in unsold housing inventory, prices continue to rise. In January, the number of unsold homes reached a record high of 86,291 units. Traditionally, such an increase in supply should lead to price decreases, yet since October, the housing price index has continued to climb. This situation raises questions about the accuracy of the index measurements by Israel's Central Bureau of Statistics (CBS). The market is also influenced by political and economic factors, including perceptions of a shift towards a religious autocracy and fiscal exploitation of workers. Banks and developers are reluctant to lower prices, fearing broader economic repercussions. Additionally, real inflation seems to be underestimated, skewing the perception of actual price increases. This complex dynamic makes decision-making difficult for homeowners and potential buyers, exacerbating market uncertainty.
