July to September 2026 | RS Nadlan
Summary
- Two rate cuts in one quarter, bringing the policy rate to 3.25%. Prime now stands at 4.75%, its lowest level since November 2022.
- A record mortgage market: NIS 11.56 billion was borrowed in July, the highest month of the year, followed by NIS 10.9 billion in August.
- Prices are falling again: according to the CBS index published on 15.10, Tel Aviv district prices fell 0.9% month on month and 1.9% year on year in July and August transactions.
- Two markets in the north of the city: prices in new construction are holding and even rising, while resale homes in the older neighborhoods are down 7% to 10%.
- Few deals, plenty of negotiation: some neighborhoods recorded fewer than ten transactions in a year, and the gap between asking price and final price reaches 7% to 8%.
The broader picture
Interest rates. The Bank of Israel cut its rate on 6.7 to 3.5%, and again on 1.9 to 3.25%, its third consecutive cut. The next decision is due on 21.10.2026. Every NIS 100,000 of prime linked debt now costs a few dozen shekels less each month, and on an average mortgage the difference is already noticeable.
Mortgages. NIS 68.7 billion was borrowed between January and July, 13% more than in the same period last year. The weighted average rate stood at 4.38% in August. Bullet and balloon loans, typical of developer promotions, fell to 13% of all mortgages, the lowest share since late 2023.
Prices. According to the CBS index published on 15.10.2026, national prices fell 0.6% month on month and 1.8% year on year in July and August transactions, after two readings of slight increases. The Tel Aviv district fell 0.9% month on month and 1.9% year on year, and the new homes index was down 0.4% year on year. The CBS resale index showed a 2.0% decline in Tel Aviv in the second quarter.
New homes. 1,236 new apartments were sold in the city of Tel Aviv in the second quarter, up 50.7% on the previous quarter and the highest figure in the country. In July, 27% of developer sales included a financing incentive, compared with 20% in May.
Purchase tax. The brackets are frozen until 15.1.2028. A sole residence pays no tax up to NIS 1,978,745. An additional home is taxed at 8% up to NIS 6,055,070 and at 10% above that amount.
North Tel Aviv by neighborhood
| Neighborhood | Price per sqm (NIS thousands) | Trend | Note |
|---|---|---|---|
| Ramat Aviv Gimel | 51 to 53 | Down about 10% over the year | 4 rooms at about NIS 4.2 to 4.4 million |
| Ramat Aviv HaYeruka | 59.8 on average | Average deal up to about NIS 5 million | 58 deals in a year, most in new projects |
| Bavli | 52.5 for resale | Resale down 7.5% | 99 deals in a year; new homes close at 53 to 59 |
| Nofei Yam | About 69 | High new build prices | 4 rooms at Einstein 15 for NIS 7.9 million |
| Kochav HaTzafon | 49 to 51 | Stable | New projects on Shai Agnon at up to 90 to 95 |
| Maoz Aviv | 54.9 on average | Wide gap between old and new | Older homes 39 to 48, the renewal project above 83 |
| Neot Afeka | 45 to 53 | Stable | Median of about NIS 4.73 million per home |
| North Tel Baruch | About 46 (median) | Slight rise, 44.4 a year ago | Only 7 deals in a year |
| Ramat HaHayal | About 47 (median) | Down, 51.9 a year ago | Only 8 deals in a year |
| HaMishtala | 45 to 49 | Stable | Median of NIS 4.54 million |
| Lamed, the original Plan L | 37 to 40 | Down about 20% since 2023 | New construction north of Einstein at 60 to 80 |
| Shikun Dan | 39 to 43 | Stable | About 750 new homes on the way |
| Revivim | About 42 | Stable | 16 deals in a year |
The figures are based on Israel Tax Authority records as reported in the press, and the number of deals in each neighborhood is small. Averages are therefore affected by the mix of homes sold, new versus older.
The luxury market
- Ramat Aviv HaYeruka: the quarter’s record deal in the north of the city was signed in June: a 5 room, 152 sqm apartment at 27 Brodetsky Street sold for NIS 14.96 million, about NIS 98,000 per sqm.
- Tzahala: villa transactions are registered with a delay, so the market looks frozen, yet 16 houses are currently on offer at NIS 7.95 to 19.6 million.
- Kikar HaMedina: the towers are nearing occupancy, and market estimates point to NIS 65,000 to 80,000 per sqm.
Urban renewal
- Neot Afeka B: on 2.9.2026 the local planning committee approved the neighborhood policy. The number of homes will grow from about 1,900 to about 3,565, with renewal zones along Moshe Sneh and Bnei Efraim streets and around the commercial center, and a city square next to the planned metro station.
- Sde Dov: on the same day a design plan was approved for a plot in the north of the district, with 320 homes.
- Neve Avivim: the projects on HaSavoraim Street are under construction. On Yehuda HaNasi, 80 apartments will be replaced by 195, and the project is still in planning.
- The citywide renewal plan (TA/5555): still in process, with no final rights. It includes Neve Avivim and Neot Afeka B.
Ramat HaSharon and Herzliya
- Ramat HaSharon: at the end of June the city had about 1,510 unsold new homes. In July it was decided to advance the expansion of the Morasha treatment plant, which will allow thousands of homes to move forward. At the end of September, demolition of 108 apartments began in Kiryat Ye’arim, to be replaced by 220.
- Herzliya: in the first half of the year the average home price was about NIS 3.78 million, down 0.9%, while the number of deals almost halved. In Herzliya Pituach, the median price of a private house stood at about NIS 15 million in 2025.
What it means for buyers and sellers
- For buyers: this is a market that rewards negotiation. Few deals, a gap between asking and final prices and falling rates create an opportunity for those ready to decide. It is worth comparing developer financing incentives with a resale home at a realistic price.
- For sellers: correct pricing matters more than ever. An older home priced against new build deals may wait for many months. Sellers who price against real transactions on the same street and in the same type of building sell faster and on better terms.
- For owners in older buildings: urban renewal is advancing in the north of the city, and renewal potential is part of a property’s value. It is worth checking the status of the plans before deciding.
What to expect in Q4
- 21.10.2026: the Bank of Israel’s next rate decision.
- Mid November 2026: the CBS will publish the price index for August and September transactions, which will show whether the July and August decline continues.
- End of 2026: expiry of the temporary order that limits 20/80 developer promotions.
Sources
The Central Bureau of Statistics, via Bizportal, ynet and N12; the Bank of Israel, via Globes, Bizportal and N12; the Chief Economist at the Ministry of Finance, via Funder; Bizportal’s neighborhood series, based on Tax Authority records; minutes of the Tel Aviv local planning and building committee of 29.7, 12.8 and 2.9.2026; ynet and Maariv. The CBS index of 15.10.2026, via Merkaz HaNadlan and i24NEWS. This review is based on data published up to 15.10.2026 and does not constitute investment advice.
