A sample conducted by the Ministry of Construction and Housing of about 18,600 apartments built in the country in the last six years shows that more than 83% of the apartments are delivered more than 60 days late, and over 40% are delivered more than a year late. This was revealed today (Monday) by the Director General of the Ministry of Housing, Aviad Friedman, during a discussion on the Sale Law that took place in the Knesset’s Finance Committee.
The data presented to the committee show that the distribution of delays shows that in 7.8% of the apartments there was a delay of up to 120 days, in 5.6%, a delay of up to 180 days, 28.2% up to 360 days and in 41.8% of the apartments there was a delay of more than 360 days.
The phenomenon of lateness is not new to the Ministry of Housing. In May last year, Amit Grady, Commissioner of the Sale Law at the Ministry of Construction and Housing, published a position paper stating that “as part of the purchase of new apartments for public housing tenants, 475 apartments were purchased between January 2016 and May 2020 in 99 different projects, spread over 38 cities across the country. “The analysis of the data shows that most of the apartments were delivered with a considerable delay, beyond what is stated in the sale contract and for the additional 60 days stipulated in section 5A of the Sale Law. The paper emphasizes, among other things, that the Commissioner of the Sale Law, as well as other parties in the Ministry of Construction and Housing, deal with many public inquiries, regarding the delay in handing over apartments and non-payment of compensation in accordance with the Sale Law.
The position paper also stated that “the data shows a picture that indicates that an event of late delivery of apartments and non-payment of compensation, according to the Sale Law, is not an exceptional event in the real estate industry. “The position below is given in direct connection with the findings presented above, as well as in connection with the extensive information that comes to the ministry regarding the conduct of the sellers of the apartments.”
According to the ministry’s investigation, the delays are due to a number of factors, including procrastination in the conduct of public authorities, contact between the seller of the apartment and professionals and service providers in projects, as well as disruptions in the global supply chains caused by the Corona plague in 2020-2021.
The Supervisor of Banks is considering including the linkages within the mortgages
As stated, this is the third discussion taking place in the Knesset’s Finance Committee on the Sale Law, which seeks to assist apartment buyers. Among other things, the bill seeks to allow, when purchasing an apartment from a contractor, linking only the construction component to the construction input index (and not the land component and other components). Private bills have recently been merged with the government bill on the subject, and the bill has been exempted from the rebate obligation. About two weeks ago, the hearing lasted about three hours, during which the voices of the contractors’ organizations and representatives of government ministries were heard, but no significant decision was made. During today’s discussion, the Supervisor of Banks announced that it is positively considering a mechanism that will include linkages within mortgages, in order to facilitate buyers of apartments affected by the sharp rises in the index in the last two years (5.6% increase in 2021, and 3.8 from 2022).
“We are thinking about it positively and we will try to find a mechanism that will put the same linkage into the mortgage, at least in part,” said Dr. Ziv Naor, director of the economic unit in the Banking Supervision Department. In accordance with the legal restrictions in the mortgage market. It’s a process, we need to see and think about how we will do it exactly. “
MK Alex Kushnir, chairman of the Finance Committee, stated: “We do not want to change the mix, but simply that the banks can address the issue of linkage, and let young couples, as construction progresses or receive the key, increase the mortgage in the original ratio, so buyers do not They will have to look for other sources of funding to fund the linkage. “
The director general of the Ministry of Housing, Aviad Friedman, stated: “We hope and are sure that the legislation will be completed because without it, tens of thousands of young couples will continue to pay thousands of shekels for linkages.”