State lands designated for marketing according to the "price per occupant" method of former Finance Minister Moshe Kahlon will be marketed from the near future according to the method of the current Minister of Construction and Housing, Yaakov Litzman. This was stated by the government at a zoom meeting held over the weekend. The Israel Lands Council will soon convene to discuss the new terms of the tenders.
Most likely on Tuesday, the Ministry of Housing will publish the draft of Litzman's plan, of which only principles have been published so far. As a result, the situation of a price-per-tenant program, which has been stuck for about two months, will also be clarified.
The Israel Land Council is the body that determines the policy of RMI (Israel Land Authority) and it is the one that determined how the land is marketed by price per occupant. According to the government decision this weekend, the council will have to discuss changing land marketing rules by price per occupant, The new marketing method, which will be based on the Litzman plan, will continue until the end of 2023.
Distinction between center and periphery and without luxury areas
Here is the place to explain the differences between Kahlon's price per occupant and the Litzman plan. As part of Kahlon's price per occupant, developers receive discounts on the land in the amount of NIS 120,000 for each housing unit that will be built, or at 80% of the value of the land, in cases where the land is cheap. The developers are competing with each other for the price per square meter of the apartment they will build. In the remote peripheral localities, where land prices are particularly low, apartment buyers are given grants of NIS 40,000-60,000. At least a thousand shekels.
Grants to buyers were discontinued on July 1, following a government decision from the end of last year to end the program at the end of June, unless budgetary resources are found for grants in the periphery. To date, these budgets have not been found, the motivation in the current government to renew the program is not high and the Ministers of Finance and Housing have already stated that they do not support the continuation of the current format. This is why the only lotteries that have taken place under the program in recent months are repeat lotteries, the apartments of which are already included in the budgeting of grants.
In contrast, Litzman's alternative plan includes a distinction between center and periphery and luxury areas will not be included in it. Litzman has already spoken out several times against the price-per-tenant system, which allowed for gains in which apartment buyers saved NIS 700,000-800,000 from apartment prices, in places like Raanana and especially Galil Yam. His approach is that the state should not subsidize apartment buyers in luxury areas. The approach is different in areas that are defined as "popular" in the center of the country, where apartment prices are not high. For them, the plan stipulates that the land will be marketed in the same formula as the price per occupant - the state will determine the price per square meter for apartments and competition between developers will be on land prices. That even the name of the state will set prices per square meter for apartments. But since land prices in these places are low, competition between developers will be on the level of land development subsidy.
The new land marketing method
As mentioned, currently the price per occupant is at a halt, even though there is land for thousands of housing units, which were planned to go out to tender. For example, 1,077 apartments in Givat Hamatos in Jerusalem, 1,600 apartments in Yehud Monosson, about 900 in Netanya, about 800 in Beer Yaakov, about 520 in Be'er Sheva, about 480 apartments in Ramat Hasharon and about 340 in Kadima Tzoran are to be marketed.
The question marks are many and the office still has no answers
As of Monday, the Ministry of Housing did not know how to give clear answers to the many questions arising from the special situation. "Globes" sent the ministry a number of questions, about points that are not clear at the moment, and are currently being discussed: for example, it is not clear whether the implementation of the Litzman plan will be done in parallel with Kahlon's price per occupant or the planned tenders will be terminated. It is also not clear the rates of discounts planned for buyers and the issue of grants to buyers in the periphery, which are also planned according to the Litzman plan.
The Ministry of Housing also did not know how to answer that the plan also claims to include the purchase of second-hand apartments. The issue is not at all related to Remi and the Israel Lands Council, but it is not clear what is happening in this matter, which Minister Litzman has already stated about him and said that he gives it priority.
And finally - so far no precise geographical definitions have been published that determine what the periphery is and what the center of the country is, as well as which luxury areas will not be included in the plan.