Israeli house prices declined in nominal terms between 1999 and 2007. But in the past three years, they have risen 48% in nominal terms and 32% in real terms.
Housing finance is one of the few remaining areas in which Israel’s biggest banks can expand. Leumi, Hapoalim, Discount, Mizrahi Tefahot and First International together hold 95.5% of the total credit advanced to the public. The central bank is likely to be wary of further consolidation.
Bank of Israel blocked Hapoalim’s $136 million purchase of 76% of Ukrinbank in 2007 – perhaps fortuitously given the extreme recession Ukraine has since suffered.
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