Rafi Gantshar - Prime Mortgages and Financing רפאל גנטשר - פריים משכנתאות

31/07/2025

It's possible to buy a home in Israel!

Feeling frustrated by the impossibility of acquiring Israeli real estate? I'm pleased to announce that in the coming weeks we will be exploring options for home acquisition for those whom are otherwise unable to purchase Israeli real estate. These will include:
• No down payment
• Insufficient income
• Poor credit history
• Properties with legal issues
These topics and more in the coming weeks! Send this link to someone you know who feels stuck in the current housing economy, and we will find a solution together.
(Link in first comment)

22/07/2025

🏠 Understanding Your Mortgage Pre-Approval: The 3 Interest Rates You’ll See 📄

If you’ve received a pre-approval from an Israeli bank, you’ve probably noticed three different interest rates listed on the document. Don’t worry — here’s what they mean in plain English:

🔹 1. Nominal Interest (ריבית נומינלית)
This is the rate you’re signing for. It’s the base rate the bank uses to calculate your monthly payments — the one you’ll see most often when comparing tracks.

🔹 2. Effective Interest (ריבית אפקטיבית)
This shows the true annual cost of your loan after accounting for compounding. Because mortgages are paid monthly, interest accumulates slightly more than the nominal rate implies — and the effective rate reflects that.

🔹 3. Total Expected Interest (ריבית כוללת החזויה)
This is an estimate based on economic forecasts. If you’re on a variable or CPI-linked track, the bank projects how interest rates and inflation might behave over time and gives you an average expected rate for planning purposes.

💡 Pro tip: Focus on the nominal rate for comparing options — but keep an eye on the other two if your loan includes variables like CPI linkage or Prime-based tracks.

Israel Advisors Forum by Prime Mortgages and Financing

https://chat.whatsapp.com/Eg8aLLRvnAC51S3IfpSMEm?mode=r_t

02/07/2025

*What is happening to interest rates?*

Variable rates on the banks have increased ever so slightly this month, but are expected to decrease dramatically in August. This is due to the fact that every rate contains two components: base and margin.

*Base:* this component of the rate is based on an "anchor". In the case of most variable rates, the anchor is government bonds, though it can also be based on BoI interest, short term loans, the LIBOR, and others. In the case of fixed loans, the base remains consistent throughout the life of the loan, and is based on the anchor at the time of loan origination. In the case of a variable, the base changes every so often based on the changes in the anchor.

*Margin:* this is the margin tacked on by the bank in addition to whatever the base is. When originating a mortgage, the margin provided remains consistent throughout loan life in both variable and fixed tracks.

As the economy has been looking up following the the events of the last five years, interest rates are expected to continue to descend. A slight hike in rates this month can be attributed to the war in Iran which affected both the base and the margins, but we hope that the coming months will see our optimism manifest as lower payments for families across Israel.

Israel Advisors Forum by Prime Mortgages and Financing

https://chat.whatsapp.com/Eg8aLLRvnAC51S3IfpSMEm?mode=r_t

23/06/2025

On Thursday, Bank of Israel published a draft of new directives to the banks. While these are not yet final, they include the following instructions due to the Rising Lion operation in Iran:
1. Banks that have offered loans to their clients and have been answered in the negative are normally not allowed to reach out again for three months. This limitation is being temporarily removed so that the banks may offer loans again during the war.
2. Under normal circumstances, banks may not allow their customers to be in an unauthorized overdraft for more than a day. Due to the situation, banks may be flexible with unauthorized overdraft and allow it to extend beyond the normal time frame, so long as they are acting towards closing it as soon as possible.
3. Banks may communicate with their customers in ways that were not previously agreed upon, so long as the customer has not specifically requested to not be contacted through that channel.
4. Credit card companies have more flexibility when approving credit.
5. A request to close a bank account must now be dealt with by the bank within ten days instead of five.
6. *For mortgages:* the banks must consider extending the validity of mortgage approvals beyond the standard 24 days. In addition, the banks may take more time to review requests.
7. Mortgages that must be signed for in the bank can now be signed for by a single borrower, and the consent of the other may be obtained through other methods deemed reliable by the bank.

As mentioned above, these changes are temporary and not yet final. However, these steps - and perhaps others - are being taken by the central bank as an attempt to ease the burden for all parties - both the banks and their customers - during this difficult time.

Israel Advisors Forum by Prime Mortgages and Financing

https://chat.whatsapp.com/Eg8aLLRvnAC51S3IfpSMEm

15/06/2025

Market Update: Inflation

Following the dramatic hike in inflation last month, our economy experienced a drop of 0.3% in the month of May, bringing inflation of the last twelve months to 3.1%. This is excellent, as the government goal has been to hit 3%. The housing price index dropped by 0.1%.

WHAT DOES THIS MEAN?

For starters, those with CPI linked mortgages will see a decrease in their monthly payment, albeit temporarily as inflation always trends upwards.
The drop in inflation will also go a long way towards encouraging Bank of Israel to finally give lowering interest rates a chance. The forecast was to begin doing so in the second quarter of 2025, yet the high April inflation caused some stalling. Hopefully, the rates will begin to trend downwards as well and we will all see relief in our monthly mortgage and all-purpose loan payments.

Israel Advisors Forum by Prime Mortgages and Financing

WhatsApp Group Invite

20/02/2024

What is REALLY happening in the housing market?

Yes, graphs can be misleading. Yes, the Israeli Bureau of Statistics freely dispenses information void of context. The graph below depicts a steep increase in housing prices after ten months of dips. What should we expect to see in the housing market moving forwards? Here are a couple of key takeaways from the recently published statistics.

1. Statistics are reported with a delay. The most likely possibility is that the numbers we are seeing were relevant months ago, but hardly reflective of today's reality.

2. The data varies by city. Some localities are experiencing consistent exponential growth, while others a drop in prices.

3. The interest rate hikes appear to have done their thing. Real estate purchases have slowed down. I've been told multiple times by potential clients that they'd like to wait for rates to drop in order to purchase their home, and their opinion seems to be shared by many.

4. In the full report released by IBS, Israeli real estate has experienced only one such drop in recent history, yet there was no panic, no bubble that burst, no urge to pull out. Israelis held on to their properties, and prices continued to surge throughout the years to come.

WHERE ARE WE HEADED?

Ultimately, the principles of supply and demand will continue to dictate the prices we pay. So long as there is not mass construction in desirable areas, or establishment of necessary infrastructure in more peripheral ones, prices will continue to rise. This is especially true in light of the fact that so many are waiting for interest rates to drop in accordance with BoI forecast. It would appear that in roughly two years or whenever interest drops, there will be a mass migration to the housing market, resulting in a steep hike in property value. When this happens, those who chose to wait will enjoy the favorable rates, but will ultimately lose out due to the increase in housing prices.

Now is the time to buy real estate.

16/01/2024

OPEN POLL RESULTS:

Thanks to everyone who answered on Facebook and WhatsApp. It seems that people's greatest concerns with buying are as follows (in this order):

1. Down payment. 25% is A LOT of money.
2. Just plain cost. The down payment is heavy, but 100% mortgages would render the monthly payments unworkable.
3. Poor investment. While I moderately (but not completely) disagree with this point, some are concerned that owning a home is not financially worth the trouble due to rent being priced lower than mortgage, as well as the existence of more lucrative options.

If we've discussed why NOT to buy a home in Israel, let's flip the question. Why WOULD someone buy, despite it all?

02/01/2024

Taking a loan to build a safe room? Here's some good news: your loan will be exempt from key mortgage regulation, allowing for greater flexibility when ensuring your safety.

The Swords of Steel war has succeeded where previous military operations did not: the authorities now allow ground level homes to add a safe room without receiving permits. In accordance with this newfound awareness of the necessity of safe rooms in every home, Bank of Israel had risen to the occasion as well in the form of multiple leniencies for loans taken for the sake of constructing such rooms. The leniencies are as follows:
• the loan period can exceed the thirty year maximum otherwise imposed on mortgages.
• the monthly payments can exceed fifty percent of the debtor's available net income.
• the entirety of the loan may consist of variable rates, instead of the standard two thirds.

All of this sounds great in paper, be how much flexibility will banks actually allow? As always, it will become a matter of risk management. While the aforementioned policies will now be left to the discretion of the banks, it is entirely possible that in practice the financial institutions will continue to partially adhere to the old rules, if for nothing more than to avoid foreclosures. As usual, the "good customers" - those with high income and little risk - or those who go through a well connected mortgage broker will be more likely to benefit from this change in policy.

02/01/2024

Need some cash? Home equity loans on existing properties can now exceed 50% of the property value to the tune of ₪200,000.

Bank of Israel takes its regulatory role quite seriously. In its efforts to minimize foreclosures, the central bank of the holy land has imposed a number for regulations on the banks throughout the years. Some of these are quite well known. The BoI cap on the use of Prime interest in mortgages was doubled from one third to two back in 2020. Another well known directive concerns the maximum value of a mortgage. Today, loans against property value can equal the following:
75% for an only property, whether for purchase or home renovations.
70% for a second property, contingent upon the sale of the first property within two years.
50% for an investment property, or for a home equity all purpose loan.
(There are exceptions such as in the housing lottery or for foreign investors.)

This week, the central bank has declared that home equity loans will be allowed to exceed the 50% cap to the tune of ₪200,000, provided that the loan did not exceed 70% of the property value, a contingency which would only be relevant for apartments valued at less than ₪1,000,000.

Is this good news? While some will protest the modern economics of living off of credit, there is no denying that this will grant access to desperately needed funds for families across Israel. We can only hope that the lifestyles these loans allow for remain sustainable.