Real Estate in Israel: How to Buy an Apartment and Obtain a Mashkanta

Real Estate in Israel: Purchasing and Transaction Support

Last updated: May 20, 2026

Purchasing real estate in Israel requires a deep understanding of legal procedures, tax obligations, and the specifics of the local banking sector. To successfully buy an apartment in Israel, you must go through the stages of property verification in the Tabu, legal contract approval, and mortgage (Mashkanta) processing. The process is accompanied by mandatory reporting to tax authorities within 30 days from the moment of signing the contract.

Main Stages of Buying Real Estate in Israel

A real estate transaction in Israel is a multi-step process where a lawyer plays a key role. Unlike in many other countries, lawyers here do not just process documents; they represent the interests of the parties in negotiations and are responsible for the legal integrity of the property.

1. Search and Preliminary Verification

At this stage, you choose a city and neighborhood. Properties in Tel Aviv, Netanya, and Haifa are popular. Simultaneously, a property check is conducted in the Tabu. If an apartment is not registered in the Land Registry, it may be listed in the records of a "Hevra Meshakenet" (management company) or the Israel Land Authority.

2. Legal Support and Contract

A purchase agreement is drawn up, fixing payment schedules, the handover date, and penalty conditions. An important element is the registration of a "warning note" (He'arat Az'ara) immediately after the first payment, which blocks any other actions regarding the property.

3. Financing and Mashkanta

For most buyers, a Mashkanta is the main tool. Banks assess creditworthiness and property value (via a certified appraiser/Shamay). Foreign citizens can also apply for a mortgage, but LTV (Loan-to-Value) conditions for them are usually stricter.

Taxes and Additional Expenses: Mas Rechisha

The primary tax when buying is Mas Rechisha. It is progressive. For residents buying their only home, there are reduced brackets, up to a full exemption for specific property values. Foreign investors and those buying a second home pay tax at higher rates from the first shekel.

In addition to the tax, one should consider:

• Lawyer fees (usually 0.5% – 1% + VAT).
• Property appraisal (Shamay) for the bank.
• Real estate agent commission (when purchasing on the secondary market).
• Life and property insurance for the Mashkanta.

Comparison: New Construction vs. Secondary Market

The choice between a developer property and a ready-made secondary market apartment depends on your goals: investment or personal living.

Comparative characteristics of property types

Parameter	New Development	Resale
Commission	Often 0% when buying directly	Standard 2% + VAT
Guarantees	Apartment Buyers Protection Law	"As Is" condition, requires inspection
Move-in time	1 to 4 years (waiting period)	Immediate or as per contract
Mashkanta	Payments may be linked to the price index	Fixed conditions from the moment of the deal

Investing in Israeli Real Estate

Investment potential is determined by location. Tel Aviv remains the most expensive and liquid market. Netanya attracts investors due to its proximity to the sea and developed infrastructure for Olim (immigrants). Haifa is considered a promising city for long-term growth due to the development of technology clusters and the port.

When planning investments, it is important to consider:

• Price dynamics in specific neighborhoods.
• Potential for "Pinui-Binui" (urban renewal) projects.
• Mashkanta interest rates and their impact on profitability.
• Tax obligations upon future sale (Mas Shevach).

Frequently Asked Questions

Disclaimer: This material is for informational purposes only and does not constitute legal or financial advice. Tax parameters and bank rates may change. Consulting with a specialist is recommended.

Updated: May 2024