Appartamento a Rishon LeZion, Israele, 115 m²

Transaction analysis!

There are not many opportunities for a private person to earn money on real estate in Israel.
Judge for yourself: the rental yield varies from 1.5% in Tel Aviv and the center to 3-4% in the periphery, prices are high, the apartment even in the initial stage of construction is not much cheaper than the finished one.

But there is one area in which a simple person (not a businessman) can make a good income.

This area is connected with renovation. There are two types of renovation in Israel:

1. Renovation of houses built before 1980, and therefore not conforming to existing earthquake resistance standards. The house is demolished and a new one is being built, 2-3 floors higher, or 2-3 floors are being strengthened and completed.

This program is called “TAMA 38” in Hebrew.

2. Renovation of the neighborhood. They take an entire block with old houses, and build a new one instead. But the number of floors in the new quarter is much higher.
   This program is called “pinuy-binuy” in Hebrew

In both cases, renovation costs nothing to the owners of old apartments because the developer finances the project by selling new ones.

Oh, yes, I forgot to say that the new apartment, as a rule, is larger, includes a security room, a balcony, and often also parking, which was not in the old apartment

Thus, the owner of the old apartment gets a new apartment for free!

This means that a person who bought an old apartment in a house to be renovated earned from 100 to 500 thousand dollars (depending on location) already at the time of purchase.

Such an apartment is now available for sale!

In the city of Rishon Lezion (20 minutes drive from Tel Aviv) there is an area that is completely under renovation and an apartment is for sale in it (her heirs live abroad).

According to the renovation agreement, the owner of this apartment receives a five-room apartment in a new building. In the meantime, he can rent it out, receiving a good rent - about 5,000 shekels per month.

The price of the apartment is 2.5 M shek

The price of a new apartment that the lucky owner will receive is 3.5 M shek.

The difference is 1 million shekels, approximately 300,000 dollars at the exchange rate.

If you are interested in such a deal, please contact us!

Boris Goren, an expert on Israeli real estate.