The proposal to amend the Sale (Dwellings) Law, which discussed changing the method of linking the prices of new dwellings to indices, passed a preliminary reading today. Housing Minister Zeev Elkin announced that he is not impressed by the contractors’ threats that the law will cause housing prices to rise. However, the continued passage of the law will wait until further amendments are made to the Sale Law, initiated by the Ministry of Housing.
The bill, first introduced by MK Bezalel Smutritz (Religious Zionism) and then in a different version by Alex Kushnir (Yisrael Beiteinu) and revealed in Globes, effectively ends the current procedure, according to which the entire price of the apartment is linked to the consumer price index or index. Construction inputs The new law stipulates that the land component of the price of the apartment must be removed from the linkage, and the linkage can only be calculated as a component of the construction costs. These are set by law at NIS 5.5 thousand per square meter built.
This is how the construction input index affects you Globes makes an order
“There will be more pressure attempts to prevent the law”
Kushnir said at the hearing that “today when a young couple buys an apartment from a contractor, the amount spread out in their mortgage is automatically linked to the construction input index. The index consists of the cost of construction cost and land price. The bill I initiated came to correct the situation and reflect the increase in construction inputs only on the construction itself and not on the land component. “I am glad that the bill passed with the consensus of all the House factions for the sake of the young couples.”
The interesting moment in the discussion, however, was when Elkin responded on behalf of the government to the bill, and reacted sharply to the reactions of the contractors, who complained that the calculation indicated in the law was incorrect, and that the operation of the law would lead to rising apartment prices. “Since I entered the Ministry of Construction and Housing we have been working on amendments to the Sale Law,” Elkin said. “Changing the construction input index is a key element in the amendments as well as an amendment on financial sanctions on contractors who are late in delivering the apartments and other amendments. Promoting legislation is important in order to allow the committee to advance the law and bring ideas to implementation and then add it to the overall government bill.
“I hear complaints and threats from the contractors that the amendment will lead to a rise in prices and that the index is not calculated correctly, and I answer that it does not impress me because if this was the result then no laws would be enacted for the benefit of the consumer. “They can do more. I want to point out that the fact that the amendment comes from the coalition and the opposition is excellent because we are ready for some more pressure attempts to prevent the promotion of the law, but together, it will be easier.”
Elkin announced that he would support the law on the condition that further legislative proceedings be carried out in accordance with the guidelines of the Ministry of Construction and Housing and on the condition that they wait with the continuation of legislation until the submission of the government’s comprehensive sales law amendments, to which the amendment will join.
MKs Kushnir and Smutrich agreed to Minister Elkin’s terms and the said law was passed unanimously.