Anyone looking for a new apartment in Ramat Aviv quickly discovers that there are almost no vacant plots in the neighborhood, so most of the new apartments that come onto the market are born from urban renewal projects: older buildings are demolished and taller buildings rise in their place. Buying a developer apartment in such a project is different from buying in a regular project on vacant land. The building has longtime apartment owners who receive replacement apartments, there is a timetable that depends on consents, planning and evacuation, and there are questions of specification, parking and allocation that do not arise in a regular project. In this guide we go through what you really need to check before signing with a developer in a renewal project in the Ramat Aviv neighborhoods.
A new apartment in Ramat Aviv: why supply comes from urban renewal
The Ramat Aviv neighborhoods were built mostly in the decades between the 1950s and the 1980s, as dense construction of three to eight floors, usually without a safe room (mamad) and sometimes without an elevator. The land is fully used, and the only way to add apartments is to replace existing buildings with denser ones. In Tel Aviv, TAMA 38 is no longer an active track, and projects advance mainly through town building plans for pinui binui (evacuation and reconstruction) or for demolition and reconstruction on a single plot.
An example that illustrates the time frame: in October 2025 it was reported that Kardan Real Estate had been selected in a residents’ tender to advance a compound on Beit Tzuri and Abba Ahimeir streets in Ramat Aviv Gimel, near the Schuster Center, where the plan is to demolish 128 apartments and build about 250 housing units, including a tower of more than 20 floors. At that stage, signatures still had to be completed and a detailed plan submitted. In other words, a project that appears in the headlines today will reach the stage at which you can buy an apartment in it only in several years. Anyone buying a new apartment in Ramat Aviv today is usually buying in a project that has already passed these stages, and it is important to know how to identify exactly where it stands. An overview of projects that have advanced recently in the area is in the article on urban renewal in north Tel Aviv and Ramat Hasharon.
Project stages and what each stage means for the buyer
A buyer’s risk in a renewal project depends almost entirely on the stage at which they come in. The table summarizes the main stages:
| Stage | What actually exists | What it means for the buyer |
|---|---|---|
| Residents’ signatures | Agreements with some of the apartment owners | No approved building rights yet; too early to buy |
| Plan approval | A plan in force setting the number of apartments and floors | It is clear how much will be built, but there is no permit and no full bank accompaniment |
| Building permit and bank accompaniment | A permit, an accompaniment agreement, voucher booklets | The stage at which a purchase protected under the Sale Law begins |
| Evacuation and demolition | The residents have moved to rentals, the building has been demolished | The planning risk is behind you; execution and timetable risk remain |
| Construction | Frame, finishing, systems | You can see progress on site and check the pace of work |
| Form 4 and handover | Occupancy approval (tofes 4) | Handover, the inspection period, and then registration of the condominium at the land registry (tabu) |
Developers sometimes offer “early registration” at the stage before the permit, with a good faith deposit and a discount. This is not necessarily an improper deal, but it is important to understand that at this stage the money may not be protected by a guarantee, the plan can still change, and the handover date is only an estimate. Any payment at such a stage should be checked with a lawyer before the transfer.
The Sale Law guarantee in a renewal project
In a pinui binui project the developer is usually not the owner of the land. The developer’s rights derive from agreements with the apartment owners, who transfer part of their rights in return for the new apartments. That is why the buyer’s security is especially important here. The Sale Law (Securing Investments) requires a seller who has received more than 7% of the apartment price to provide the buyer with security, and in practice, in bank accompanied projects, this is a bank guarantee issued for every payment made through the project’s voucher booklet.
In a renewal project the accompanying bank has two groups of clients to protect: the buyers, who receive a Sale Law guarantee, and the longtime apartment owners, who usually receive guarantees of their own, such as a guarantee for rent during construction and a guarantee for completion of the building. From the buyer’s point of view, an accompaniment agreement with a bank or a recognized financial institution is a sign that the project has undergone an economic review. How the voucher booklet works, and what the guarantee does and does not cover, we explained in our guide to developer 20/80 deals.
Replacement apartments and developer apartments in the same building
This is the most fundamental difference between a renewal project and a regular one. In the new building, longtime apartment owners who received a replacement apartment will live side by side with new buyers who bought a developer apartment. A few points worth checking:
- Where your apartments are in the building. The agreement with the residents determines which part of the building is allocated to them. Sometimes the replacement apartments are concentrated on certain floors or exposures, and the developer apartments on the upper floors. Ask to see the allocation table and not only the apartment being offered to you.
- Uniform or different specification. In some projects the replacement apartments receive a different specification from the developer apartments. This affects future maintenance and the uniformity of the building.
- Parking and storage. The parking standard in Tel Aviv keeps shrinking, especially near public transport corridors. Check in the contract whether a parking space and storage room are attached to your apartment, and whether the space is a standard one or in a stacked parking system.
- The mix of owners and running costs. In a tower with a lobby, several elevators and shared systems, the building management fees are far higher than in an older building. Longtime owners coming from a building with minimal maintenance are not always prepared for this, and it may affect decisions at the residents’ meetings in the first years.
- A compound built in phases. In a compound of several buildings, your building may be handed over while a neighboring building is still under construction. Ask about the order of works and what access, noise and landscaping will look like in the first years.
Technical specification: what to check beyond the materials
The specification attached to the contract is a legal document, not marketing material, and anything not written in it is not guaranteed. Alongside the type of flooring and sanitary fittings, it is worth checking:
- The net ceiling height in the rooms and in the safe room, and the location of the safe room relative to the apartment layout.
- The number of elevators relative to the number of apartments, and whether there is a Shabbat elevator.
- The air conditioning: preparation only or an installed system, and the location of the condensers.
- Exposures and view. A view of the park or the sea from the upper floors is not guaranteed if another plan is being advanced on a neighboring plot. Check what is planned on the adjacent plots.
- The price list for buyer modifications and the deadline for requesting changes. Changes paid directly to suppliers and not through the vouchers are not covered by the guarantee.
Timetables, delays and compensation
In a renewal project the timetable is especially sensitive, because demolition depends on the evacuation of all residents. One resident who refuses to vacate may delay the start of works by months. So it is better to come into a project after evacuation has been completed, or at least to build extra time into your personal planning.
What the law says about delay: in contracts signed on or after July 7, 2022, following Amendment 9 to the Sale Law (Apartments), a handover delay of more than a month entitles the buyer to monthly compensation calculated according to the rent for a similar apartment, starting from the contractual date, at a rate that rises the longer the delay lasts: 100% of the rent in the first months, 125% after that and 150% for a particularly long delay. It is also important to know that construction input index linkage stops on the contractual handover date, even if the apartment is handed over later. The contract may include exceptions for events outside the developer’s control, so the delay clause is worth reading with your lawyer.
A worked example: what a six month delay costs
The example is for illustration only. A family buys a four room apartment in a renewal project in Ramat Aviv, and plans to move into it from a rented apartment. The rent for an apartment similar to the one purchased is estimated at ₪12,000 a month. The apartment is handed over six months after the contractual date.
- In the first months the compensation is 100% of the rent: four months times ₪12,000, ₪48,000.
- In the fifth and sixth months the compensation is 125%: two months times ₪15,000, ₪30,000.
- Total compensation under the law: about ₪78,000, compared with additional rent of ₪72,000 that the family pays over the same period.
In this case the compensation covers the rent, but not what cannot be measured in money: a school move that was postponed, a lease that has to be extended on less favorable terms, or home upgraders who timed the sale of their previous apartment to the handover date. Anyone selling an apartment to finance the purchase should also read our guide for home upgraders, because a handover delay directly affects the tax time windows.
Indexation, taxes and the final price
The price in the contract is not the final price. Three components add to it:
- Indexation. Since July 2022 only up to 40% of the apartment price may be linked to the construction input index: the first 20% is not indexed, and of every further payment only half is indexed.
- Purchase tax (mas rechisha). A developer apartment is subject to regular purchase tax according to the brackets. The calculation for a single apartment and for an additional apartment is set out in the article on purchase tax in 2026.
- VAT. The price of a new apartment includes VAT, and this is part of the comparison with a resale apartment. We wrote about what this means in the article new or resale apartment.
When a resale apartment in the same neighborhood is the better choice
The comparison is not only financial. A resale apartment allows immediate move in, you see exactly what you are buying, and there is no timetable risk. On the other hand, it is important to check whether the older building itself falls within a renewal plan: anyone who buys an old apartment in a building about to be included in pinui binui is in effect also buying a future of years of renting and a replacement apartment. We set out these checks, from the building file to the planning status, in the article on checks before buying an apartment. For those weighing the neighborhoods themselves, it is worth getting to know the neighborhoods of north Tel Aviv and Ramat Aviv Gimel in particular.
Questions to ask the developer before signing
- Is there a valid building permit, and who is the accompanying institution?
- Has the evacuation been completed, and how many residents have not yet vacated?
- How was the allocation of apartments to residents and buyers determined, and where is my apartment relative to them?
- What is the contractual handover date, and which exceptions appear in the delay clause?
- What exactly is attached to the apartment: parking, the type of parking, a storage room?
- What is planned on the adjacent plots and in the next phases of the compound?
- What are the expected building management fees, and who is the management company?
- When is the condominium expected to be registered at the land registry?
It is worth getting the answers in writing, and having the contract and the specification reviewed by a lawyer acting for you. We accompany buyers in comparing new projects and existing apartments in the Ramat Aviv neighborhoods, and you can also browse our properties for sale.
Frequently asked questions
Is it safe to buy an apartment in a pinui binui project before a building permit?
At this stage the money may not be protected by a Sale Law guarantee, and the plan and the handover date may still change. Such a purchase requires a legal review of the mechanism protecting the payments before any transfer.
What is the difference between a replacement apartment and a developer apartment?
A replacement apartment is given to a longtime apartment owner in the demolished building, in return for their rights. A developer apartment is sold to buyers to finance the project. They can be in the same building, sometimes with a different specification and location.
How long does construction take in a renewal project?
After evacuation and demolition, construction of a tall residential building usually takes several years, and a tower longer. The stages before the permit, from signatures to plan approval, often take longer than the construction itself.
What happens if the developer is late with handover?
In contracts from July 2022 onward, a delay of more than a month entitles the buyer to monthly compensation based on the rent for a similar apartment, at a rate that rises with the length of the delay, and indexation stops on the contractual handover date.
Is purchase tax paid on a new apartment in a renewal project?
Yes. A buyer of a developer apartment pays purchase tax according to the regular brackets. The tax reliefs in renewal projects are intended for the longtime apartment owners who receive a replacement apartment, not for buyers.
Before you choose a new apartment in Ramat Aviv
A new apartment in Ramat Aviv in a renewal project can be a very good decision, provided you come in at the right stage, understand the structure of the building and plan the timetable carefully. If you would like to examine a specific project or compare it with existing apartments in the neighborhood, we would be happy to help. You can contact us or call 077-500-4600 (from abroad, +972 77 500 4600).
The information in this article is general and does not constitute legal or tax advice. Every transaction should be reviewed by a lawyer and a tax advisor according to its circumstances.
