Photo: Sebastian Sheiner
Price of real estate is soaring
Photo: Sebastian Sheiner
The Jerusalem emblem

Americans in Jerusalem land rush

Capital hard hit during Intifada, but in few months since Arafat's death has turned into Israel's hottest real estate location

JERUSALEM - Joy Silver, an American Jew, recently purchased what was once the luxury home of the Baroness de Rothschild in the Yemin Moshe neighborhood in Jerusalem.


The house, which covers an area of 350 square meters (about 3,760 square feet) cost her USD 1 million.


In an article hailing the headline "The fever of the second home" published in this week's issue of "The Jewish Week" published in New York city, Silver said it was a good buy, a real find.


More and more American Jews are

rediscovering the holy city and prices have soared by 20 percent, making it all the more difficult for the average Israeli to purchase an apartment here.


Despite the boom in real estate, there is also a downside. Places such as the David City neighborhood for example, have turned into ghost towns that only come alive over the holidays when owners come here to celebrate.


Soaring real estate prices  


The demand for Jerusalem real estate has brought about a steep hike in prices throughout prime locations such as Rehavia, Mishkenot Sha'ananim, Talbiya, Yemin Moshe, Old Katamon, Baka and the German Colony.


Apartments here are being sold like hot cakes. According to market evaluator Levi Yitzhak, the time an asset spends on the market has dropped by 30 percent compared to last year.


In the Italian Colony for example, a new four-room apartment is being offered to American buyers for USD 535,000, a "find" in their terms, or as it appeared in an American newspaper: "a price not considered expensive by a resident living in the Upper West Side of Manhattan, but for the average salary earner in Israel, it's a fortune."


Chairman of the real estate appraisal office Ran Vernick said that while Israelis are still wallowing in the recession, Jewish Americans are coming here with their check books and buying apartments.


"In the past year American Jews purchased at least 200

apartments in Jerusalem's best neighborhoods." he said.


Returning to Gilo


Most American buyers are seeking apartments in the prestigious neighborhoods; however, they are also shopping elsewhere.


An American couple purchased a five-room apartment recently on Kaf Tet Benovember Street for USD 383,000.


Moreover, a five-room apartment was sold on King George Street in the center of the city for USD 263,000.


Rehavia is the most sought after neighborhood. An apartment on Eben Gvirol Street was sold for for USD 456,000 and a five-room apartment on Hagara Street for USD 647,000.


Apartments are also being purchased by foreign residents over the phone or via the internet.


Levy Itzhak, editor of the apartment price list noted several such examples:


  • USD 578,000 - Luxury five room apartment on Ha'ari Street, with elevator and private parking.

  • USD 583,000 - Luxury Five room apartment on Ussiskin Street.

  • USD 447,000 - Luxury four-room apartment on Hildemyer Street. (Four days after being put on the market.)
  • USD 300,000 - A three-room apartment with a view in the German Colony:


None of these apartments were seen by the buyers.


The more run-down neighborhoods have also seen a rise in prices, but it is the Israelis who are purchasing them.


According to Yitzhak, the religious sector is seeking apartments in the cheaper neighborhoods such as Kiryat Yovel, which has also seen a rise of 15 -25 percent within the last few months.


For example, a three room apartment on Zangwill Street could barely have be sold for USD 100,000 in the past but was recently purchased for USD 125,000, and is being put on the market again for USD 135,000 – and there are many who would jump at the opportunity to buy it.


During the shooting on Gilo during the Intifada, the price of real estate plummeted by 35 percent. Now Gilo is back in demand.


According to Bernard Raskin, Director General of Re/Max Israel, a four-room apartment on Arieh Ben Eliezer Street was purchased for USD 138,000 two weeks ago, compared with just USD 80,000 in December 2003.


Opposite the Temple Mount


The gamble on the American market in Jerusalem has brought two veteran entrepreneurs Zalman Shoval and Shlomo Grofman to purchase an expensive plot of land near the Sheraton Hotel.


The land is set to be used to build a residential project that is custom-designed to American tastes and standards.


Grofman said he believes Jerusalem real estate will continue to rise.


A presale of the Nof Zion project to New York Jews via Anglo Saxon managed to sell 30 yet-to-be-built apartments effortlessly.


"The Jerusalem scenery with the Temple Mount and the old city visible from the terrace means more than anything to American Jews," said Benny Lubel, a Jerusalem Anglo Saxon franchiser.


In some places prices are as high as USD 8,000 a meter, (10.76 square feet) higher than the going prices in Tel Aviv.


The apartments are not intended for immediate occupancy, but are waiting for the buyers to come to Israel.


פרסום ראשון: 02.24.05, 21:47
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