Kiryat Shmona Real Estate Market Faces Stagnation Amid Uncertainty
The real estate market in Kiryat Shmona, Israel, is currently experiencing a significant downturn, as reported by the Israeli newspaper Calcalist. Following a recent ceasefire between Hezbollah and Israel, the market has not shown signs of recovery due to ongoing uncertainty regarding future developments in the region. Residents are eagerly awaiting substantial government investments to stimulate economic activity, which have yet to materialize.
Data from the Israeli tax authority reveals a stark decline in real estate transactions, with only 79 apartments sold in Kiryat Shmona from October 2023 to August 2024. This figure is a sharp drop compared to 115 sales during the first two months of 2022 alone. The overall real estate prices have also seen a significant decrease, with only 11 transactions exceeding one million shekels, a stark contrast to the numerous high-value deals recorded in 2022.
Local real estate broker Abithar Cohen highlighted the stagnation, stating, “The market is at a standstill,” and noted that most recent transactions were either completed before the conflict or were inheritance sales. The lack of consumer activity is evident, with many businesses in the city closed and a reliance on purchasing power from Upper Galilee residents who have not yet returned to the area.
Challenges and Future Outlook for Kiryat Shmona
The challenges facing Kiryat Shmona's real estate market extend beyond sales; rental prices have also plummeted. Rents for older homes have dropped from around 3,500 shekels ($980) per month to approximately 2,500 shekels ($700). Broker Yedidia Alnatan expressed a cautious optimism, suggesting that the market may gradually recover as clarity about the future improves. However, he emphasized the need for an additional 15% price reduction to attract potential buyers.
Residents are increasingly concerned about the lack of comprehensive reconstruction plans, which they hope would mirror the significant investments made in southern Israel. Promised initiatives, such as the establishment of a university and a railway, remain unfulfilled, raising doubts about the region's ability to bounce back. Cohen remarked on the pressing need for these developments to revitalize the local economy and restore confidence in the real estate market.
