The State of Israel is currently in one of its most challenging and complex periods since its establishment. The ongoing war has claimed the lives of thousands of civilians and security forces, with multiple fronts being fought simultaneously and hundreds of thousands being evacuated from their homes.
Now, a comprehensive rehabilitation plan sits on the table for decision-makers. This is precisely the time for an opportunity that should not be missed. The ability to address the concerns of residents about returning to their homes lies not only in the security realm but also in the economic one.
“A proper and smart rehabilitation of the North and South, including the Gaza border region, can lead to real estate development, economic growth, and high-quality immigration. At this point, it is clear to everyone – we are headed for revival," explains Liran Ovadia, Head of the Business Division at Bank Jerusalem, along with Shalom Amoyal, Manager of the bank’s Mortgage Division.
"In 2025, after the events of October 7, the rehabilitation of the North and Gaza border region represents an opportunity for a new, well-planned beginning, one that addresses needs and shapes our future and the future of generations to come in a way that will significantly strengthen both the social and geographical periphery,” they said. “Proper planning for the rehabilitation phase requires decision-makers to think creatively about a more balanced population distribution, the development of industrial and transportation infrastructure, and support for social mobility."
Ovadia and Amoyal continue: "There is no doubt that with the revival that will reemerge in Israel, real estate and infrastructure markets in these regions will be key players, enabling new and renewed construction that will rejuvenate cities. This will create an opportunity that no one predicted: to attract quality populations and to upgrade infrastructure comprehensively."
Additionally, they say that, "in recent months, we have identified a significant increase in the level of interest from foreign residents who are suffering from rising and increasing antisemitism in the countries where they live. There are groups of foreign residents who have opened current accounts and even transferred initial equity for purchasing apartments.
"To this, we add an increasing interest from this population in buying properties in non-traditional high-demand areas, such as Beit Shemesh and Givat Ze'ev,” they said. “It can be cautiously stated that Israel is likely to soon experience a wave of immigration, bringing with it many entrepreneurial, creative, and educated minds – foreign Jews who will seize the opportunity to turn this place into a home that is good to live in."
How to rehabilitate in three stepsEntrepreneurs and contractors play a critical role in the rehabilitation and revival of the country in general, and the North and South in particular. It is crucial to follow a clear and organized roadmap to ensure that the work on the ground will bear fruit.
True, this is not the ideal timing for the real estate sector – nearly two years of rising interest rates have created challenges that forced all players in the industry to recalculate their paths, and some did not survive. Homebuyers are dealing with high interest rates, and the government, which was required to formulate support solutions, has not managed to stop the crisis. Then came the war, the prices of raw materials soared, manpower in the sector was impacted, and decision-makers had to redirect their attention elsewhere.
The result? A sharp decline in building starts alongside increasing demand, which led to a reversal of the trend and a rapid rise in prices since the beginning of the year. Now, in order to leverage the opportunity that has been created, the real estate sector must act in three main areas, as outlined by Ovadia and Amoyal:
1. Holistic Planning Adapted to Future NeedsSmart planning can create new opportunities for those who had not previously considered changing residences. It begins with making train stations more accessible so that private cars will be needed less, continues by connecting employment and office areas within walking distance, and integrates with a science park that will provide not only jobs but also essential services, such as programs for gifted children.
In addition, there is an urgent need for the rehabilitation of damaged buildings, strengthening foundations in preparation for earthquakes, fortifying educational institutions, and using innovative, green building technologies that will ensure quality and durable buildings over time.
When there is a national need to establish a new settlement, the state must ensure that the process is beneficial to all parties. Government incentives should ensure that the settlement is not just a temporary solution but a high-quality, innovative place that can become a symbol of planning excellence. In cases where the economic feasibility is not immediate, the state should intervene with subsidies and support to bridge the gap.
Ultimately, Israelis are not naive – they want quality of life. A settlement that will attract residents must offer more than just apartments; it must include nearby employment, advanced public buildings, green parks, scenic promenades, and public spaces that will create a thriving community. Only then can we ensure that the revival becomes a real opportunity, not just a slogan.
2. Shortening Construction Period for SuccessThe war has significantly lengthened construction times, to the point that the delivery date for apartments has become a gamble. Today, the average construction time is already three years, and from planning to receiving the keys – it takes no less than ten years. In a period of high interest rates, such delays create a heavy burden on everyone – developers are tangled with expensive bank financing, and buyers are forced to bear increasing mortgage costs.
The government has the tools that can change the situation: improving planning efficiency, shortening licensing processes, synchronizing between the various parties, and simplifying bureaucracy. Rapidly increasing the supply of apartments is the only way to reduce prices in the long term – not through one-time programs that sound good in headlines. There are no magic tricks in real estate, only hard and efficient work – and that is exactly what is required now.
3. Dealing with Housing Prices Revival cannot happen without a solution to housing prices. In order to allow families to realize the dream of homeownership, the state must remove barriers, accelerate urban renewal projects, and shield thousands of additional apartments with fortified rooms.
Increasing supply is key, but it must come alongside smart financing solutions. The Bank of Israel and the government must ease access to mortgages for the public – whether through extending repayment periods beyond 30 years, as is common in other countries, or through increasing financing percentages for new homebuyers, as has been proven successful in the "Price for the Tenant" program.
If the state acts correctly, this challenging period can turn into an opportunity – not only for rehabilitation but also for creating an affordable, stable, and smarter real estate future.
In conclusion, in order to fully seize the historical opportunity that has been created, decision-makers must act with determination and responsibility. This is the time to rise above politics and place the country's best interest at the top of the agenda.
The road to true rehabilitation and revival requires concentrating powers in a professional body that will know how to manage planning and execution wisely, efficiently, and tailored to the needs of the entire population. There is no room for delays here – it is time to act, initiate, and build a stable, safe, and prosperous future for the State of Israel.