Real Estate Purchases by Foreign Residents – Problem or Advantage?

For some time now, we have been witness to real estate price increases in Israel, in light of which the issue of real estate purchases by foreign residents is once again on the public agenda as one of the reasons for the increase in prices.

Starting in 2005, ideas have been raised by government officials with the aim of making it more difficult for foreign purchasers in order to make real estate purchases unfeasible for them and leaving more open possibilities for Israeli citizens.

These ideas include raising municipal taxes for empty apartments, levying a tax on foreign residents who rent out their apartments, and raising the purchase tax, as well as cancelling the betterment tax exemption when selling a property.

Eitan Bloomberg, CEO and owner of the Anglo-Saxon office in Herzliya Pituach, and the son of Anglo-Saxon founder Dave Bloomberg, believes otherwise.  According to him, “the assumption that real estate purchases by foreign residents has a part to play in the spiking of prices in Israel is a misleading assumption.  Foreign residents’ purchases are a drop in the ocean, and distancing them from the real estate market in Israel will apparently have no effect, other than the damage Israel’s economy and harm relations with Diaspora Jewry.  The main way to solve the problem of real estate prices in Israel is to release land and build massively.”

He explains that, “we need to embrace and encourage foreign residents to buy in Israel, since the very fact of their being here contributes a tremendous amount to the economy.  In addition, we must not forget that there is a Zionist dimension to this, and it is important that these residents have an attachment to Israel.  Throughout most of Israel’s independence, tremendous efforts have been made to bring foreign residents to the country and have them put down roots here, and now suddenly, at the first opportunity, we are turning our backs on them.  This is made even more callous when with one hand we ask for donations from the wealthy of the world, and with the other we make it difficult for them to buy real estate.”

Bloomberg suggests that the approach be changed and that Zionist and the real estate problem in Israel be combined by encouraging property owners to rent them out at low prices to young couples and poor families, population groups who are having difficulty purchasing apartments in the current situation.

The story of the establishment of the Anglo-Saxon chain provides a basis for this concept.  When Dave Bloomberg, immigrated from South Africa for Zionistic reasons, he got to know the world of real estate which was then in its infancy.  In 1964, he established his first office which, as the name of the chain alludes to, had the goal of focusing on the anglo-saxon market segment in particular, and on foreign residents in general, for the purpose of investing in Israel, under the slogan that remains with the company to this day half a century later: “Have a foothold in Israel.”

Through the elder Bloomberg’s connections with the South African government, he succeeded in having investment in Israel recognized as an investment by that government, during a period when bringing money outside the country was almost impossible.  In that way, he merged Zionism with his work.  Since then, Anglo-Saxon has handled many transactions with foreign residents, and it continues along this path.

Category : News and Articles

Leave a Reply

Send to Friend

Email Agent