Mortgage Market Insights for 2024 and Beyond
The annual conference of the Mortgage Association in Israel brought together over 750 consultants and banking leaders to discuss the future of the mortgage market. Despite the ongoing challenges posed by the Iron Swords war, the market is exhibiting signs of recovery. According to data from the Bank of Israel, mortgage approvals reached NIS 7.75 billion in June 2024, marking an 18.5% increase compared to the same month last year. This upward trend began in May 2024, indicating a renewed interest in home buying.
Expert Opinions on Market Dynamics
Nofer Yaakov, chairman of the Mortgage Association, highlighted the evolving role of mortgage consultants, stating that over 60% of transactions are now guided by these professionals. He emphasized the importance of having a knowledgeable consultant to navigate the complexities of securing a mortgage, especially during turbulent times. Furthermore, Ariela Randalstein from Bank Hapoalim noted that while interest rates remain high, the demand for new apartments is still strong, as potential buyers seek opportunities in a constrained market.
Record Spending Amidst Economic Challenges
In July 2024, Israelis began their summer vacation with record spending on credit cards, totaling NIS 46.264 billion, a 12.2% increase from the previous year. This unprecedented expenditure coincided with the 10th month of the ongoing conflict, indicating resilience in consumer behavior. Notably, online transactions surged by 11.6%, contributing to a new record of NIS 26.957 billion in online spending. Tali Hollenberg from Sheba company reported growth in sectors like travel and entertainment, suggesting that despite the war, the economy is adapting and evolving.
- The growth in the mortgage sector is particularly significant as it reflects a broader trend of recovery in the real estate market, which had been under pressure due to rising interest rates and geopolitical tensions. As the economy stabilizes, more Israelis are turning to mortgage consultants for guidance in making informed decisions about their largest financial investments. The increase in credit card spending is also noteworthy, as it indicates consumer confidence despite the backdrop of conflict. The rise in both online and physical transactions showcases a shift in shopping behavior, with many opting for online purchases while still engaging in traditional retail. This dual growth suggests that businesses are finding ways to cater to changing consumer preferences, further contributing to economic resilience.
