📊 Israel Housing Market Update – Cooling Trends, Regional Shifts, and Record Inventory (May–July 2025)

Overall Market Trends

Between May and July 2025, 21,640 apartments were sold nationwide – a 6% decline compared to the previous quarter (Feb–Apr 2025). Adjusted for seasonality, sales were down a sharper 12.6%.

Year-over-year, the slowdown is even more evident: compared to the same period in 2024, transactions fell 19.6% (–23% seasonally adjusted).

New vs. Second-Hand Apartments

🏗️ New Apartments

• 34.3% of total sales (7,430 units) were new-builds, with 26.3% sold under government subsidy programs.
• Versus the prior quarter: sales declined 15.4% (–17.9% seasonally adjusted).
• Versus last year: a dramatic fall of 36.4% (–37.6% seasonally adjusted).

🏠 Second-Hand Apartments

• 65.7% of sales (14,210 units) were resales.
• Versus the prior quarter: stable at –0.1%, though –9.3% when seasonally adjusted.
• Versus last year: sales fell 6.8% (–11.4% seasonally adjusted).

July 2025 Snapshot

In July, 8,140 apartments were sold – a 33.7% rebound compared to June (+21.8% seasonally adjusted). However, compared to July 2024, sales were still down 15.9% (–21.5% seasonally adjusted).

• New-builds: 2,750 units (+34.1% vs June; +33.3% seasonally adjusted). Year-over-year, however, sales plunged 31.2% (–33.9% seasonally adjusted).
• Resales: 5,390 units (+33.5% vs June; +15.9% seasonally adjusted). Compared to July 2024, sales were down 5.1% (–11.7% seasonally adjusted).

Long-Term Trendlines (2021–2025)

The broader trajectory shows clear cycles of expansion and contraction:

Total sales:

• Oct 2021–Apr 2023 → average –3.9% monthly decline.
• May 2023–Jun 2024 → +2.5% monthly growth.
• Jul 2024–Jul 2025 → –1.5% monthly decline.

New-builds:

• Aug 2021–Mar 2023 → –3.8% monthly decline.
• Apr 2023–May 2024 → +3.8% monthly growth.
• Jun 2024–Jun 2025 → –2.6% monthly decline.

Second-hand units:

• Oct 2021–Aug 2023 → –3.6% monthly decline.
• Sep 2023–Nov 2024 → +2.9% monthly growth.
• Dec 2024–Jul 2025 → –2.9% monthly decline.

Regional Dynamics

• Central District: 24.4% of national sales, including 27.9% of new-builds.
• Southern District: 22.8% of sales, including 27.5% of new-builds.

Geographic highlights:

• New-builds: declines across all districts.
• Second-hand: mixed trends – growth in the North, Jerusalem, and South, declines in Tel Aviv, Central, and Haifa.
• Leading cities: Ofakim & Tel Aviv-Yafo (new-builds, 500+ units each); Jerusalem, Haifa, and Be’er Sheva (resales, 700+ units each).

Inventory – New Apartments Remaining for Sale

As of July 2025, 82,530 new apartments remained unsold. At current absorption rates, this equals 31.1 months of supply.

• Month-over-month: +1.3%.
• Year-over-year: +19.8%.
• Since April 2022: stock has grown at +1.5% per month.

Where is the inventory concentrated?

• Tel Aviv District: 31.9% (26,310 units).
• Central District: 23.6% (19,480 units).

Among major cities:

• Tel Aviv-Yafo leads with 10,210 unsold units.
• Jerusalem follows with 8,030.

What This Means for Tel Aviv Buyers & Sellers

🔑 For Buyers:

• Developers face mounting pressure from record-high inventory, particularly in Tel Aviv and the Central District. This environment could open opportunities for incentives and negotiation.
• Resale apartments remain comparatively stable, with Tel Aviv continuing to attract demand despite slower volumes.

🔑 For Sellers:

• Positioning is everything. With buyers more selective and cautious, well-located and well-presented properties still command strong attention.
• The second-hand market is proving resilient, but sellers must price realistically to align with new market dynamics.

Bottom Line

The Israeli housing market is clearly in a correction phase. New-builds face the twin challenge of declining demand and rising supply, while resale apartments show relative resilience. For Tel Aviv, the city remains a demand magnet, but success in today’s market requires a strategic approach – whether buying, selling, or investing.