If for a moment you managed to come to terms with the fact that you will probably not really have an apartment in Tel Aviv in the coming years, we are here to discourage you even more. It turns out that with the inconceivable increase in the field of housing in Israel in the last two years, a particularly interesting phenomenon occurs: the prestigious real estate market moves up almost in line with the American market, which with another small rise is the one responsible for the ozone hole.
So before we get started, a few numbers, and we recommend you sit down before reading: A Florida-owned oceanfront mansion belonging to former US President Donald Trump’s family is being offered for sale for $ 59 million. This is a $ 10 million increase over last year If that’s not enough, singer Adele bought Sylvester Stallone’s house in Beverly Hills for $ 58 million! Red Gear sold his house a month ago for $ 28 million, and the former Sydney Crawford villa is being offered for $ 100 million! And these are just celebrities.
You are probably telling yourself that in Israel there is no chance of that happening. So here are some numbers from here: At the beginning of the year, Asi Tochmeier purchased 1.5 dunams in Neve Tzedek in a total deal of NIS 105 million. Moshe Mamrod, the controlling owner of Tadiran, purchased a 330-square-meter plot of land in Neve Tzedek, on which a very small and old house is to be demolished. Mamrod paid NIS 40 million for the property, ie at a value of NIS 120 million per dunam. Want more? A penthouse on Hayarkon Street is sold in NIS 108 million in the Aviv Promenade Towers project. And if we are talking about penthouses, then in the luxury tower at Arlozorov 17 in Tel Aviv, a penthouse apartment with a size of 370 square meters was sold at a value approaching NIS 50 million.
The first question I asked Roy Kenner, an expert in luxury real estate marketing for Israelis and foreign residents and CEO of the Montefiore Real Estate Group, was: Why now?
“This is the question of the hundred million dollars, and note that I do not say ‘million’, because even in the State of Israel a million dollars is no longer too much. Trying to find an answer to your question all over the Western world. The same thing happens in the US and Canada. , And prices just keep rising. “There are not many private lands in Israel and there is a large rate of population growth, so we even feel it more.”
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Kenner says that factually we may never know the answer. The hypotheses? Until the outbreak of the epidemic the real estate market in general and the luxury market in particular were on a moderate rise, which he calls a “healthy rise”. “Then the corona came and brought the market to a standstill,” he explains. .
And not just luxury real estate.
“Expensive real estate, period. All the more so in the luxury market, which is also becoming more expensive. There is an increase in transactions. In the field of luxury we are already used to large numbers, but such numbers we have not yet seen. Luxury apartments are being hijacked, and we have never used this term “kidnapped” in luxury. Prestige is not snatched because it is supposed to be given to a small percentage of the population in advance – how can such a thing be snatched? But what we found out is that there is a lot of money here, and we have seen people aged 50-60 plus and younger who come and buy luxury real estate and in quantities, “he explains.
Between Cassio and Rolex
Does this put the market under stress? Does it also affect the regular market?
“The luxury market has always been disconnected from the regular market. It’s a different market, like Rolex vs. Cassio. Whoever had it, always bought luxury. But what happened – and this is really a phenomenon that has no unequivocal explanation yet – is that luxury dragged the property market to new heights. Huge amounts of money were released, and people ran for real estate, for all real estate. And it’s not just the luxury real estate market, you see this influx in the luxury car market as well. People are buying luxury everywhere. A lot of money was released into the world air. Probably what was kept close to the chest – maybe after the plague people felt it was time to release it and enjoy it. The plague restored the security of the house, and people saw the fall in the stock market (which has meanwhile recovered and risen – TL) and the rise in the real estate market. It was like a fire in a field of thorns, “he says.
You work with foreign residents and also with Israelis. Is this still the trend of the French?
“The French wave has been fading in recent years. The decline of the euro against the shekel, which was significant, also contributed to this. It also tightens the regulator’s positions on the transfer of funds to the State of Israel. The French take their money and invest elsewhere, whether in France or Portugal. Even our coastal towns have become expensive for them and an investment that is not so worthwhile. Whoever enters the market more and more is the American market, also in terms of immigration, and see the correlation. We also see a much higher attraction to Israel – which was not the case in the past. Americans who once sat on the fence suddenly come, buy apartments and love the prime locations. And of course Jews from England, South Africa and Australia, “he notes.
And who is not left?
Are there differences in the desired locations between foreign residents and Israelis?
“Foreign residents are mainly looking for coastal cities, which are a natural resource we have and do not have. The attraction is in a prime location. They love the familiar and close to the center. There is such a trend of buying a home in Israel if anti-Semitism worsens,” he explains.
At this point in the conversation I throw to Kenner the question about the people who do not leave us apartments …
“They really like to slander these people and it’s not clear why. The amount of taxes they pay to the state is enormous: purchases and property taxes amount to billions, and they do not ask for discounts or benefits, but pay a lot for the right to buy an apartment here,” he says.
Hard or easy to work with?
“The expertise is in working with them. These are very smart people. You have to understand their culture, the way to approach them. Sometimes you also need to know about the politics in their countries, what not to talk to them. An American customer is completely different from a French customer, for example. “Besides, it winks at them. It greatly enhances their property,” he says.
What are their requirements, other than the Holy Land?
“Luxury buyers, including all these sophisticated buyers, know that they put a lot of money, especially here, so they first of all like the things that make life in the State of Israel quality: proximity to the sea, to the holy places, to the quiet streets. Luxury buyers love special things, something they can “Think and not others. Think of one in a hundred works, just like in art. They like to be in the best lot on the street, want the most special locations, the historic buildings. They like to have something that sets their property apart, added value that is not found elsewhere,” he notes. .
And Israelis, what are they buying?
“Israelis will usually start and end at a price. Israelis do market surveys at an sometimes inconceivable level, they will analyze every house on the street, and I’m talking about the ultra-rich.
“They want a deal. Even when I take them to places where everything is done at the highest level, in the end the price plays a role for the Israelis very much. They will agree to compromise on many things that foreigners will not agree to compromise, just to get a discount and feel good price. Israelis do not like to pay above the market, and unfortunately, luxury properties are sold above the market. “We have closed the gap, because today Israelis are exposed to world trends, everything today is very global, and they see and want houses like the ones in the most magnificent towers next to the park in Manhattan or Bel Air,” he explains.
Trump Mansion in Florida (Photo: Joe Raedle / GettyImages)Miami Weiss
Joining the call is entrepreneur Yadin Group Development and Construction Ltd. Guy Yadin, and he explains the reason for the American madness that is affecting the whole world. “Today the market in Miami has become an illogical market in terms of its prices. Prices are boiling these days, and it stems from the crisis of all trade and real estate in New York due to the influx of people from the West Coast to the East Coast in the past year. Florida has become one of the most sought after states because of taxes, especially Miami, “B”.
And yet from the data you showed me, the luxury market is still a niche, and there are thousands of apartment sales a year.
“Exactly. The demand is enormous, and the supply, which is not that great, causes prices to rise, although Florida has a lot of realizable land and many projects that manage to be sold before the permit is obtained on paper. In Israel, for the same reasons and for other reasons, the market is boiling.”
If Miami is the right marker, then Tel Aviv is our Miami?
“There is a lot of demand for penthouse apartments today, especially in Tel Aviv because of the distress that was in Corona and garden apartments in the Tel Aviv envelope in the northern neighborhoods. Know that people are willing to pay insane prices. The second hand market in Tel Aviv is also inconceivable. Around NIS 47,000 per meter and even NIS 55,000 per meter for things that require renovation. In the projects we are dealing with, such as demolition and reconstruction and evacuation of construction, prices in the last year and a half have risen to unreasonable heights. , Sold for no less than NIS 60,000 per meter. The special apartments reach amounts of NIS 10-15 million. Last week, we refused an offer we received for a payment of NIS 80,000 per meter. “
What does “you refused” mean?
“Today we refuse buyers who want to buy in such amounts. The supply of these apartments is very small and the demand is huge, and people are willing to pay, and there is no end to it. By the way, it is not just older people, but even very young people. .
It also eliminated, in your opinion, the regular market?
“Those who are looking for an apartment in Tel Aviv for sale today find it very difficult to find. The sellers understand that the property they are putting on the market is much higher than they imagine, and they know how to demand a significantly higher price. There is no grip between the price per square meter and what actually happens. Here is another example: in Tel Baruch North, a five-room apartment is not new, but in good condition a year and a half ago it cost around 4.2 million. Today, if you look for a five-room apartment in this neighborhood, you will not find less than 5.5 million, and that is only in the last year. This is something that does not make sense, and it is not about new apartments made of nylon. And it is important to say that the expensive price does not necessarily indicate that it is a luxury apartment, but is due to the lack. “
Guy Yadin (Photo: PR)LOCATION, LOCATION, LOCATION
What is the difference between an expensive apartment and a luxury apartment, is there a criterion?
“Certainly. The location. The more you enter the center of Tel Aviv, the more expensive the value of the land and the more considered the location. The more expensive the specifications, the more suppliers there are, which is what luxury is characterized by. Ultra-luxury is also a coveted field and it is characterized by towers. “By the way, they really like the towers and the proximity to everything.”
It happens not only in Tel Aviv of course. This is Kfar Shmaryahu, Herzliya, Caesarea. The reference is to villas, luxury homes and estates, even in the village of Netter, and Yadin mentions the old Tel Baruch neighborhood where Bar Refaeli is building its private estate. However, Yadin notes that the price of private homes has not risen as much as the housing market, which has risen significantly. He says: “It’s a little different, and it’s hard to explain. In principle the price of the land is supposed to be the same, but the math doesn’t work that way. Somehow there is a higher demand for apartments.”
Of course, we will not end up without an optimistic tone, which can make you, even if you are only in the top decile and not in the millennium, the owners of luxury apartments. how? With the help of design. Shira Muskal is an architect (from Hillel Architecture and Interior Design), whose partner interior designer Hadas Roth mainly cultivates luxury projects. Muscle notes: “Most of our projects are mainly turning existing properties into luxury properties, when they already have a base, and this allows us to make revolutions in a very short time in a relatively short time.”
She explains that the unimaginable change and demand is related to two main reasons: “One is the global world, travel, hotel exposure – design and user experience are something people see not only in photos, and people want to have one. And the other is the corona, which further strengthened the home and its importance. , And those who can afford it, now want to bring home everything they had outside.Gyms, home theaters, pools and saunas – everything has moved one step further.
“Also the whole issue of wine, a home bar and a drinking experience, and even study rooms. If we used to design a work area on the road, today a couple wants to set up Wei Work inside the house. And the other level is of course the infrastructure and materials. “A certain level of windows, awareness of thermal and acoustic insulation and imported windows.”
So do not have to be rich?
“We are all Israelis who want to touch the sky, and I think part of our job is to provide that experience. When there is a high budget we can play and do what is beyond. But we always prioritize and think about how to give added value and the feeling that you are not in a normal home. The complete living experience. ”
Shira Muskel (Photo: PR)