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Real Estate in Israel
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Found already an interesting property in Israel? Before you invest in Israel, it is important that you understand real estate in Israel and how does it works in order to make your decision a better one.
The real estate business in Israel has developed and improved and is still growing in the last years. The main reason is the legislation of the realtors' law in 1996, which gave the profession a legal status and determined the realtors' obligations and rights.
Besides, the awareness grew and the significance of this field has increased. Although the development process in the latest years, the real estate business in Israel has still much more to achieve.
The real estate has a great impact on Israel's economy and there is high correlation between the curve of Israel's economy through the years and the real estate condition. Although there are ups and downs in real estate just like any other business, for each property there is a potential buyer and money is the main obstacle. Real estate varies between different countries although it is the same idea. The process of a real estate deal in Israel matches the common mentality of Israelis, in spite of the changes and development in the recent years. It is an important issue to consider when we buy, sell or rent a property, because there are different techniques of work.
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Realtors' Law
The realtor's law was legislated on 1996, and it says that anyone who provides real estate services in return for brokerage, must have a license and the list of licensed real estate brokers. The law itself can be found in the realtor registrar unit in the ministry of justice:
www.justice.gov.il/MOJHeb/RashamHametavchim/Default.htm
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Realtors' Fee
In Israel the realtor represents both sides of a deal and there is no conflict of interest, because he acts as a mediator. The common fee is 2%+VAT in a buy, sell deal, and 1 month of rentals + VAT for a renting deal. The fee is charged separately from each side of the deal.
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Real Estate agencies
There are many real estate agencies in Israel, some of them are private agencies, and some are part of a chain. Some of the chains are regional, some are Israeli and some are international.
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Specialization
The real estate business in Israel is divided by specialization, which is defined by 4 criterions:
Area of Activity: area covering extent of the agency. The agency works in a specific neighborhood or all over the city.
Population: type of population that the agency works with defined by religiosity and socio-economic status.
Service Type: different services the agency offers. The agency offers sell and rent services or gives also free valuing and consulting services.
Property Type: different properties the agency works on (apartment, office, villa and more), and whether it is in the residential or commercial field.
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Agencies Models
There are 4 different agencies models, which varies one from the other by the specialization, which is measured by the combination of the criterions:
Generalist: The agency works on everything available without focus.
Hybrid-Specialist: The agency is specialized for each of the criterions but works at the same time on all.
Variegated-Specialist: The agency has several specializations from each criterion.
Specialist: The agency is specialized for specific criterions.
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The above definitions have no saying about either the quality or the success of different agencies in Israel, or in the world at all. Each agency is a specific case.
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