Israel: The rise of settler sub-prime
Banks’ competition to write mortgage business is putting pressure on Israel’s Green Line.
Rising house prices within Israel’s pre-1967 borders are creating more incentives for poorer families to take up lower-cost housing funded by state-subsidized mortgages in the occupied and annexed territories.
Egged on by the central bank, the government says it has responded to lower affordability by selling more state land, and plans to use tax incentives to increase the supply of housing. The problem is that the international community disagrees with Israel’s definition of where housing expansion is legitimate.
Mortgage lenders in Tel Aviv speak for hours about Israel’s red-hot real estate market without once mentioning the West Bank or East Jerusalem. Ask about the link to the building of settlements and the embarrassed, more liberal, respondent will dismiss settlers as fringe right-wing zealots. But a study by Israeli pressure group Peace Now shows that settlers are motivated more by finance than by ideology, in this country of wide income disparities.
Out of a population of seven million, some 500,000 Israeli settlers live on the West Bank and in East Jerusalem. All four of Israel’s biggest banks maintain branches in post-1967 occupied or annexed territory.
According to an October report by Tel Aviv-based research project Who Profits from the Occupation, these banks or their subsidiaries all advance mortgages for settler housing.