Will Northern residents return to their homes? On August 13, a report by the Treasury’s chief economist was released highlighting a worrying trend in the Northern housing market.
This is the first analysis of its kind in the report; it was conducted among residents evacuated from the north, south and border region around Gaza after settlements in these areas were cleared during the Iron Sword war.
Overall, the analysis shows that the number of home purchases by residents of these evicted settlements fell by 8% in the first half of the year compared to the same period last year. In contrast, the total number of transactions nationwide increased by 26%.
Are residents of the northern conflict zone moving to Haifa?
The most interesting finding of this analysis: Among those who bought a home in the first half of the year, the share of northern evacuees who bought a home in the north has dropped sharply – from 76% last year to just 43% this year. Looking at it from another perspective, more than half of northern evacuees who bought a home in the first half of the year chose to leave their northern communities and buy a home farther from the northern border.
At the same time, the proportion of northern buyers buying a home in the Haifa district tripled from just 9% last year to 28% in the first half of this year – despite Haifa being a major target in the Second Lebanon War. This may reflect, among other things, the fear of northern border residents to continue living near the border.
In addition, there has been an increase in purchases by residents of Tel Aviv’s northern border areas and central districts, probably by those who can afford the significantly higher prices in the inner cities compared to Haifa.
A similar analysis among residents evacuated from the south, including Ofakim and Netivot, found that while the share of southern evacuees who bought homes in the southern district also declined, this decline was much less pronounced than in the north. The share of southern evacuees who bought homes in the southern district fell from 93% last year to 87% this year.
In addition, it is interesting to note that the number of houses purchased by residents of the evacuated southern settlements (except Ofakim and Netivot) was more than twice the number of houses purchased by evacuees in the north – 586 versus 228.
Other interesting findings from the analysis:
• Over the last two months (May-June), residents of the Gaza border area have seen a significant increase in home purchases. The number of homes purchased in June was the highest since the beginning of the year. In contrast, evacuees in the north have seen a more moderate increase in purchases over the last two months.
• A quarter of evacuees living in the north who bought a house in the first half of the year have yet to sell their current house (and have declared their intention to sell it – a “house on hold”). A slightly lower rate of 21% was recorded among residents of the Gaza border.
• 17% of the houses purchased by evacuees from the north in the first half of the year were investments (“an additional house”). This rate is in line with the national average. Conversely, only 10% of the houses purchased by residents of the Gaza border in the first half of the year were investments.
• 43% of the houses purchased by evacuees from the north in the first half of the year were new buildings. Among residents of the Gaza border, 57% were new buildings.
