Report: Young couples buy fewer apartments
Young married couples rent more, buy less. Because of gov't assistance, bottom decile purchase rate up 15%
Figures released on Tuesday by the Central Bureau of Statistics (CBS) demonstrate the claim that within the last generation it has become more difficult for young couples to purchase an apartment. The CBS figures, which rely on the 2012 household expenses survey data, show a decline in the proportion of ownership of apartments by young married couples ages 30-39 over the last 16 years.
Between 1997 and 2002 the percentage of 30-39 year olds who owned apartments decreased from 68.7% to 56.7%. As a result, there's been a rise in rental rates for that age group, from 25.2% to 37.2%. The CBS reported that this trend has been registered mostly among married couples.
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The drop in share of apartment ownership among young couples contributed to the general trend of lowered real estate ownership in the population. The CBS found that from 1997 to 2012 there was a drop from 70.2% to 67.9% in the rate of ownership of at least one apartment in the overall household.
Yet, the drop has not affected all parts of the population. While young couples saw their ownership rates significantly dwindle, there was a surprising increase in real estate purchases among the bottom decile – from 26.1% to 40.7%. There was also a rise reported in the rate of ownership of two or more homes per household, from 3.2% to 7.9%.
The rise in ownership rates among the poorer elements in society demonstrates the vast influence of the targeted policy of the Construction and Housing Ministry, which found residential solutions for needy citizens, through subsidies and grants. The rise in ownership rates of two or more housing units shows the well-known trend over the last few years of increased activity by real estate investors.
According to the CBS, the rates of apartment ownership in Israel are still high compared globally. In Israel, nearly 70% of the population owns at least one apartment, compared to a developed world average of 63.2%.
Among the entire community of property owners, 39.9% make monthly mortgage payments to a bank. The average amount of a mortgage payment in 2012 was NIS 2,965 ($833) – higher than the average rent, NIS 2,567 ($721).
