It is becoming more and more difficult to buy or build a house in Israel. Here are some interesting statistics: In 1984 – 30 years ago – Israel’s GNP was $30 billion. Today, it is $300 billion. Back in 1984, the average income per person was $7,000; today it is $38,000.
Sounds wonderful.
But here is another statistic: In 1988, approximately 60 average salaries were needed to buy an average four-room apartment in Israel. The same apartment today costs 144 average salaries.
In other words, we are producing 10 times more than in the 1980s, we earn five times more than in the 1980s, and yet we must work more than twice as much in order to buy an apartment.
Why?
First of all, lack of space. When there is no land, the price of available land rises. That is elementary economics. In the early 1990s, Israel stopped building in Judea and Samaria. Land reserves in Israel’s pre-1967 borders are practically depleted. Nor is the Negev an exception. Although the area looks large and empty, it is mostly occupied by the army, illegal Bedouin settlement, infrastructure, and green areas.
With the current (blessed!) population growth trend, Israel needs 70,000 new housing units annually. That is more or less a new Ramat Gan every year. Add to that the million and a half new olim that we should expect to arrive in Israel over the next decade, and we have a serious shortage on our hands. There is nowhere to put all of this new housing, and there is already talk of building into the sea…
At the rate things are going, our children will have nowhere to live. We can close the country in two decades or choose the Hong Kong option and live in one-room apartments in skyscrapers, which would only put the problem off for a short while.
What is the solution? We must declare, and believe, that the Land of Israel is truly ours and once again build in Judea and Samaria. Once we do so, the housing market – particularly in Israel’s central region – will drastically improve. Israel must immediately plan and build cities all along the western foothills of Judea and Samaria. A large Modi’in-like city, for example, could be built in the foothills of the Talmonim region, 10 minutes from Ben Gurion Airport, which would relieve pressure from greater Tel Aviv and lower housing prices.
In addition, Israel’s land must be privatized. The government owns approximately 90 percent of the land reserves within Israel’s pre-1967 borders, making it an effective monopoly and resulting in higher prices. The solution is to privatize or, more precisely, return the land to the nation. To the nation, not to controlling interests. Israel should allot the land to its citizens by lottery according to specified criteria and allow market forces to determine prices.
Finally, we must get rid of the bureaucratic monster that stands in the way of anybody who desires to attain a building permit. The wait for such a permit can take as long as 15 years!