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Israel Real Estate Practices
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Overview
Israel has a technologically advanced market economy with substantial government participation. Despite limited natural resources, Israel has intensively developed its agricultural and industrial sectors over the past 20 years. In 2004, rising business and consumer confidence as well as higher demands for exports boosted the Gross Domestic Product by 2.7%.
Real Estate Practices
Acquisition costs consist of a real estate broker's commission (usually 2%) and an attorney's fee (usually 1%) on top of which is added a value added tax (VAT). The purchase tax is progressive and is calculated by dividing the purchase price of the dwelling into three levels with each level being assessed a different rate of tax.
Property and ownership information is formally recorded at the District Land Registry and is a public record.
Mortgages are available on immovable property, typically require two co-signers, and usually equal 50% of the value of the property. Mortgages are offered by commercial financial institutions as well as the government. The government has senior priority on foreclosures of property.
The closing process, which takes approximately six months, consists of incremental payments of the purchase price, capital gains and other taxes. Upon final payment, the buyer receives a deed also know as Netzach Tavo which means «generations to come». Transfer and registration of settled land is achieved under the Torrens System, the land title system, which provides a certified, accurate land record.
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