The announcement was made Wednesday by Palestinian millionaire Bashar al-Masri, who owns the construction company tasked with building the new West Bank city.
Al-Masri lauded Israel's Civil Administration for granting the permit. "I doubt whether the establishment of any other city in the world faced so many bureaucratic obstacles, but the important thing is that it's en route to being built," he told Ynet. "This is a big step in the right direction."
Earlier, al-Masri said that he wants city residents to maintain a positive relationship with Israelis.
"Israelis are invited to come and visit any time, and even though our target audience is Palestinian, if Israelis also want to buy apartments there, they're welcome," he said.
Rawabi is slated to become the first Palestinian city to be built in the territories since 1967. The town is expected to offer some 12,000 housing units, a 1,000 of which are already under construction. Planners expect the new residents, most of them middle class Palestinians, to move to their new homes at the end of 2013.
Apartment prices are expected to be in the $85,000-140,000 range, in line with current PA real estate costs.
Changing Palestinian mentalityAl-Masri is working to enable young Palestinians to purchase apartments in the city with the help of a mortgage company. "I would be happy to see them taking out a mortgage in an Israeli bank, but even I cannot open a bank account there," he said.
In a recent real estate conference, al-Masri vowed to make Rawabi a modern, Western-style city.
"We're not only building homes there, but also public parks, shopping malls, and a country club," he said. "We wish to change Palestinian mentality where life is confined to the home…we wish to return to the warm neighborhood feeling I remember from my childhood in Jenin, where everyone knew everyone, but to do so in a modern fashion."
Elior Levy contributed to the story
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