Real estate purchases by Americans said to be slowing

"The second intifada really brought down the market and the number of foreign buyers here dropped considerably," [David Baruch], who left his position as CEO of the Bank of Jerusalem earlier this month, told The Jerusalem Post on his last day on the job. "But then, on the other hand, over the last three years, the violence has mostly dropped off, and coupled with a rise of anti-Semitism around the world, we have seen an unprecedented run of foreigners buying up real estate across the city."

"It is really the dream of so many American Jews to be able to own a piece of property in the Holy City and the Bank of Jerusalem has helped a large percentage of them in making it a reality," he said, estimating that the bank handles approximately 40 percent of all foreign mortgages in Jerusalem. "We are more familiar to people in New York than in Herzliya and we can attribute our success to the fact that we have built our activities specifically for foreigners."

"In 2008, high demand will continue to push prices in the Jerusalem real estate market higher," Baruch said. "However, American Jews, who have been purchasing apartments across the city at a very fast rate, will buy apartments at a slower clip as the effects of this year's subprime crisis set in."

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The garden city north of Tel Aviv

At the moment, the decision to live in Hod Hasharon is largely financial as a 100 to 120 square meter apartment in the middle- class areas of Tel Aviv can cost some $500,000 compared to approximately $320,000 in Hod Hasharon.

"The price of an average 100 sq. m. apartment in Hod Hasharon is approximately $330,000 compared to $500,000 in Tel Aviv, $400,000 in Ra'anana and $360,000 in Kfar Saba," according to Dror Limor the Re/MAX franchisee in Hod Hasharon.

"We have adapted our new projects to this demand for extra large apartments. Even three-room apartments have to be 110 sq.m., on average," says Edna Hasson deputy general manager marketing at the Prizat Hasson real estate company, which builds extensively in Hod Hasharon. "A four-room apartment of 130 to 140 sq. m. is common in our projects. The same holds true for penthouses and garden apartments. Customers demand large open spaces terraces or roofs and large gardens - 100 sq. m. of terrace or 200 sq. m. of garden are not uncommon in our building projects."

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