Real estate data reveals: Apartment sales slowdown intensified during the summer

The reporting season for the second quarter of 2026 is nearing its end, and the reports of residential construction companies are beginning to paint a picture of a recovery in sales. On the face of it, some companies recorded an increase in the pace of transactions, but the question arises whether this is a real change in trend or a point-in-time recovery.

The interesting figure is not limited to the number of apartments sold until the end of June: some companies also detail the sales they made from the end of the quarter until the date of the report's publication, which makes it possible to examine whether the improvement continued in the third quarter.

What do the data say?

Let's start with the numbers. The Ministry of Finance's real estate sector review for June points to a certain recovery in activity in the new apartment market in recent months. Thus, in June alone, 3,672 transactions were recorded - an increase of about 28% compared to the preceding months (January-April), and 9,670 new apartments were sold in the second quarter. At the same time, construction continues at a high pace: between April 2025 and March 2026, building permits were issued for about 82.5 thousand apartments, a new record; construction began on about 76.5 thousand apartments, and the completion of construction increased by almost 16%.

To examine whether the improvement in macro data is also trickling down to the field, we checked the results of the large public residential construction companies (market cap over 2 billion shekels) that have already published their second-quarter reports. Note that we focused on companies that also reported the number of apartments they sold from the end of June until the report's publication. In addition, we recall that July this year included the entire period of the 'Three Weeks' (Bein HaMetzarim), during which part of the public tends to avoid significant purchases.

So what do the data say? Tidhar sold 279 apartments in the second quarter, but after the end of the quarter and until the report's publication period (about 55 days), it sold only 11 apartments. This is a particularly significant gap between the activity in the quarter and that recorded after it, even though the company's sales in the first half jumped by about 81% compared to the same period.

I.H. Damri also recorded a slowdown in the period after the quarter. The company sold 237 apartments in the second quarter, a significant portion of which were under the 'Mechir LeMishtaken' (Price for the Resident) program, but in 48 days it reported that it marketed 89 apartments through sales agreements and purchase requests. At the same time, the Acro Group sold 42 housing units during the second quarter, and after the report period sold another 46 units, but 24 of them are purchase requests that have not yet matured into a binding contract.

Africa Israel Residences also sold 71 apartments in the second quarter, and afterwards sold 57 apartments in just 50 days. However, similar to Acro, the apartments sold after the report's publication include both sales contracts and purchase requests.

Prashkovsky presented a more stable picture in sales after the quarter. However, transaction activity in the second quarter was low: the company sold 26 apartments in the quarter, compared to 19 apartments in the following 48 days. Azorim maintained a similar sales pace even after the end of the quarter: the company sold 55 apartments in the second quarter and another 42 apartments in the 51 days that followed.

Ashtrom Residences and Shikun & Binui also published sales data in their reports, but did not detail the number of apartments sold in the period after the report date. Ashtrom Residences sold 52 apartments in the second quarter, compared to 63 apartments in the same period last year, while Shikun & Binui sold 44 apartments in the second quarter, compared to 74 apartments in the same period.

And what is happening in the smaller companies? Kardan Real Estate, for example, sold 144 apartments in the second quarter and another 12 apartments in the period after the report date, while Rothstein sold 46 apartments during the quarter and 20 additional apartments in the period that followed.

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'Change? Only in 2027'

Ziv Ein-Eli, a real estate analyst at IBI Investment House, explains that the apartment sales data in the second quarter look good at first glance, but the picture is more complex upon deeper analysis. 'When you look at the data after the report date, you actually see a return to the weaker data from the first quarter,' he says. Ein-Eli also believes that we are not facing a change in trend.

Raz Domb, a real estate analyst at Leader Capital Markets, joins his words: 'On the face of it, when you compare the Central Bureau of Statistics' sales data for the first half of 2025, you see a nice growth of about 9%. However, one must remember that the comparison is to a period where there was already a decline in sales.' According to him, when comparing the data to a stronger period, such as the first half of 2024, the picture looks different: 'Then there was a boom in contractor promotions, and this year a 21% decrease in the volume of transactions was recorded compared to 2024.'

Domb adds that the first half's data also require an examination of the transaction mix. According to him, out of about 17-18 thousand apartments sold in the first half of the year, about 30% were in government-subsidized transactions, so the volume of transactions does not necessarily reflect demand in the free market. 'We are still in a period where it is difficult for developers to sell,' he says.

Looking ahead, Domb notes that 'there is a chance that we might see an interest rate cut next week. A reduction of a quarter of a percent will help developers on the financing expense side and will also encourage demand to take a mortgage.' However, according to him, it is still difficult to estimate when a turnaround will occur. The election campaign, says Domb, may also affect the behavior of buyers, so in his estimation, a significant change in trend may only arrive in 2027.

His words align with what the Deputy CEO and one of the controlling shareholders at Ashtrom, Oren Nussbaum, said in a conversation with investors. 'We expect that towards the end of this year, the beginning of next year, we will see a significant exit from the stagnation we were in and a continuation of significant growth in demand,' he said. Nussbaum emphasized that 'although we continued and increased revenue volumes, profit narrowed because construction costs have risen and increased in recent years, and on the other hand, sales prices have not risen as in the past.'

What will happen in the next reports?

In the coming week, additional indications are expected to be published that will help complete the picture regarding the state of sales in the market. Aura, for example, will publish its reports on Friday, and it will be interesting to see how the promotion it launched for Hever club members affected sales after the quarter, in which double-digit discounts were offered on a number of the company's projects.

Hagag's reports are also expected to attract interest, after the company launched a promotion offering buyers particularly easy financing terms, including low equity at the time of signing and guaranteed rent until receiving the keys in its project in Tel Aviv. In addition, Israel Canada's reports are expected to be published, which will provide another indication of the sales pace at one of the large residential companies.