Complete Guide to Buying an Apartment in Israel

The Bank of Israel requires a minimum 25% down payment for a first apartment (30% for a second property, 50% for investors). On a 2 million NIS apartment, that's 500,000 NIS before closing costs.

Closing costs add 3-5% on top: purchase tax (mas rechisha), lawyer fees (0.5-1.5%), real estate agent commission (1-2% + VAT), building inspector (1,500-3,000 NIS), and Tabu registration fees.

If you're an oleh, you may qualify for reduced purchase tax thresholds. Consult a tax advisor who specializes in olim benefits — it can save you tens of thousands.

Israeli mortgages (mashkanta) are structured differently than in most countries. Bank of Israel regulations require that at least one-third of the loan be at a fixed rate. The remaining portions can be variable rate, CPI-linked, or prime-linked.

Interest rates in 2025 are in the 4-5% range for fixed-rate tracks. CPI-linked loans offer lower nominal rates but carry inflation risk. Most mortgage advisors recommend a mix of tracks for diversification.

Critical tip: never take mortgage advice exclusively from the bank offering the loan. Independent mortgage advisors (yo'etz mashkantaot) cost 1,500-3,000 NIS but can save you significantly over the life of the loan.

Check the Tabu (Land Registry) extract for the property. This reveals ownership history, registered mortgages, liens, and any legal notes. Your lawyer must do this, but ask to see the extract yourself.

Verify the property matches its building permit. Unauthorized construction (charigot bniya) is common in Israel — adding rooms, closing balconies, or building on rooftops without permits. If you buy a property with violations, you inherit the liability.

For new construction: verify the developer's bank guarantee (aravut bankit). This protects your deposit if the developer goes bankrupt during construction.

The apartment itself is only part of what you're buying — the neighborhood matters enormously. Check what's planned for construction nearby: a 25-story tower across the street will change your daily life.

Use Schuna to check building permits, planned transport infrastructure, cell tower proximity, and overall neighborhood scores. This data comes from official government sources and is updated regularly.

Don't forget to ask about va'ad bayit (building committee) fees and any planned building maintenance. Old buildings (pre-1980) often need expensive infrastructure upgrades.

Skipping the building inspection: an independent engineer inspection costs 1,500-3,000 NIS and can reveal structural issues, plumbing problems, or moisture damage that would cost 50,000+ NIS to fix.

Not checking the neighborhood: a beautiful apartment next to a construction site, under a cell tower, or in a flood zone is a different purchase than it appears. Data-driven checks before emotional decisions.

Rushing the process: Israeli sellers often create artificial urgency. Take the time to do proper due diligence — a week of research can save years of regret.