The Marker, Amitay Ehrlich, 11.08.2020

Recent satisfaction surveys indicate that the public is dissatisfied with government policy, which does not provide a satisfactory response to the war in Corona. As the second thread, the grievance overrides the arbitrariness with which decisions are made, annulled and changed. In order to buy public trust, there seems to be no disputing that more consistent decisions should have been made. Nor is it disputed that public trust is an important tool in the war on the virus.

Ironically, it seems that the real estate management policy in Israelhas similar characteristics. One of the reasons for the realization of real estate prices is the uncertainty and difficulties of adaptation. Let me start by saying that this is not the most significant factor, but it seems to me that there is no dispute that the real estate industry, unlike other industries, is characterized by too frequent changes, some minor and others significant.

At the macro level, for example, one day the state decides that the Israel Land Authority will stop marketing land in the free market at the highest possible price (original plan); Trying to promote a "zero VAT" program (second program); moving to a "target price" (third program); stopping and moving to a "price per occupant" program (fourth program); And say hello to " affordable housing" (Fifth Program).

The difficulties of the system adapting to changes create instability. People who were not ready to buy an apartment felt that the window of opportunity for a price per occupant was closed and hurried to buy an apartment. Similarly, people bought apartments with no intention of living in them, just to take advantage of the benefit, and so it turned out that even a conservative plan designed to get along well with homeless young couples, became a target for real estate speculation.

In the field of execution, too, the requirements of the planning and supervisory authorities are new for the mornings. There is no disputing the necessity of safe construction, economical and green construction, ethical construction. But here too the common denominator is an inability to predict the price of the final product which ends in a steady rise in execution prices.

Another significant area for apartment pricing is the area of ​​taxation. The changes in direct and indirect taxation, and the temporary provisions that are repealed or extended, cause an unhealthy spin in the market. One day the purchase tax is increased, the next day the improvement tax is reduced, the VAT changes, and so is the improvement levy. There is no stability.

We were recently informed that the Finance Committee has approved the reduction of the purchase tax for buyers of a second apartment, as part of the approval of the assistance plan and grants.

It is clear to everyone that in a dynamic world there is no room for absolute stability, but it seems that the leaders of the economy would do well to think twice before deciding on changes that have an impact on the real estate market.

Usually, when you want to kill an idea, you send it to a committee. This is not my intention, but it may be possible to set up a committee of some representatives from the fields of planning, implementation, taxation from the private sector, together with government officials, who will examine horizontally any change in legislation or legislation, which has a direct impact on real estate prices. And when to apply.

The author is an attorney, a senior partner at Goldman Ehrlich Edelstein Avigad & Co. - GEElaw