Written by Arie Stern
Housing Minister Rabbi Yitzchak Goldknopf and Finance Minister Bezalel Smotrich presented the 2024 housing plan to the government on Sunday. The scope of the plan is approximately 2 billion naira and its goal is to address the impact of the war on the construction industry.
Planning highlights:
- 1 billion shekels for affordable housing on the periphery: The cost of developing settlements on the periphery will be increased from 50,000 to 40,000 per apartment, with the aim of making marketing bids for projects more attractive and attracting entrepreneurs. Subsidy the shekel. Minister Goldknopp assured that the initiative will facilitate the construction of approximately 10,000 new apartments priced at 800,000 shekels, in a scheme primarily aimed at reservists. In addition, dozens of settlements within 9 kilometers of the Lebanese-Syrian border will be upgraded to the highest subsidy level (50,000 shekels per apartment), and construction in Kiryat Shmona, Shlomi, Hazor and Katzlin will be upgraded. promoted.
- 462 million shekels to promote urban regeneration on the periphery: Using a model similar to Ashkelon for strengthening non-fortified structures, it provides subsidies to settlements based on their ability to promote urban regeneration. Local governments receive funding to encourage contractors to participate in urban regeneration plans through development, grants and subsidies, reducing project costs and making urban regeneration plans more attractive.
- 300 million shekels in subsidies for settlements that exceed their construction quotas: Each settlement that issues more than 500 construction permits will receive a special subsidy. The subsidies will be transferred to the authorities through new agreements between the states and the settlements. In addition, the state will proceed with the implementation of the Alnona Fund, which aims to transfer Alnona benefits from villages with high business income to villages with low Alnona income, in exchange for facilitating construction permits.
- 50 million shekels as a government guarantee for contractor financing: This money goes to banks and funding bodies to help contractors finance new construction. The warranty only covers the contractor's initial construction portion (pre-sale). This usually requires an early sale of the apartment or higher equity. The Treasury Department, which promoted the measure, said the guarantee would allow banks to reduce the number of apartments contractors need for early sales, giving them more freedom to access financing. The guarantee will only be enforced if the project reaches a payment stoppage.
- 9 million shekels to accept foreign workers: The government will increase the quota for foreign workers to 65,000. The quota will come into effect when 45,000 foreign workers are hired in Israel's construction industry, but will increase if more than 20,000 Palestinian workers return to Israel. Another 10,000 potential foreign workers could arrive later as part of the import of foreign construction companies into Israel.
- 50 million shekels for the development of new construction technologies: This funding will be transferred to the Ministry of Housing and Economy to promote advanced factories for rapid construction and training programs for technological development.
- 30 million shekels to promote the employment of Israeli workers in the construction industry: subsidies for new employees and facilitation of training.
The plan also proposes longer working hours on construction sites, deferral of payments to entrepreneurs on Israel Land Authority land, and tax discounts for entrepreneurs in the long-term rental sector.
According to the Ministry of Housing, there are currently more than 62,000 unsold new apartments in Israel. The number of apartment purchases decreased in the last quarter of 2023, with only 7,280 registered purchases, a 76% decrease compared to the parallel quarter of 2022.
