Apartments Without Protected Spaces Have Seen Faster Price Growth Than Protected Ones

To what extent does the presence of a protected space (Mamad) in an apartment increase its value? This question has been asked many times during the war, but a comprehensive analysis conducted by Adv. Rotem Zilber, a real estate appraiser and founder of BYNDbiz — an AI platform that assists in appraisal work — shows surprisingly that since October 2023, prices for old apartments without a Mamad have risen faster than prices for apartments with a Mamad.

The estimated reason is that the personal security provided by the Mamad enters into economic competition with the potential for appreciation found in an old apartment, which may participate in a future urban renewal project.

Surge in demand

It is commonly thought that since October 2023, and after the missile rounds with Iran, Israelis want a Mamad: Madlan measured a jump of about 200% in demand for protected apartments as early as November 2023; Yad2 found that demand for renting apartments without a Mamad dropped five times more than for apartments with a Mamad; WeCheck measured a rental premium of about 20% for a protected apartment; the Chief Economist at the Ministry of Finance reported that in March 2026, about 80% of the apartments purchased were protected; and real estate professionals we meet tell of the difficulty in selling old, unprotected apartments.

All this should have lowered the prices of old apartments, and perhaps even lowered some prices, but despite this — as we will demonstrate later — there is a significant difference between market dynamics for rental apartments and apartments for sale.

For the purpose of the check, BYNDbiz divided the transactions into two parts: apartments built until 1990, which are not equipped with a Mamad, and those built between 1996 and 2022, which are second-hand apartments with Mamads. For the purpose of the check, the company tried to deduct transactions made in new apartments, so that developer promotions, their profitability, and so on, would not 'sneak' into the calculations.

In total, 111,000 transactions reported to the Tax Authority were examined, and it turned out that the price per square meter of apartments built before 1990 rose by 11.2% cumulatively between 2023 and 2025 — compared to an increase of only 2.6% for new apartments from the Mamad era.

When divided by city, these findings were repeated in 27 out of 35 cities where enough variables were sampled.

"On the side of rent and demand, the thesis that apartments with a Mamad are more in demand works exactly as expected," says Zilber. "If we follow publications from various sources in these areas, we see that Yad2 reported to Globes that between the beginning of February and the beginning of March 2026, demand for renting 4-room apartments dropped by 15.8% — but only 4.6% in apartments with a Mamad, compared to 24.4% in apartments without a Mamad; a month later this was reflected in prices, when according to WeCheck reports, rent for small apartments with a Mamad rose 4.9% in one month, against 3.1% in the market as a whole. By June 2026, Yad2 was already measuring rental gaps of tens of percent between apartments with and without a Mamad."

The conclusion: apartment renters can react within months, and they really did react. On the other hand, for apartment buyers, the situation is more complex, and here one must distinguish between demand that has risen greatly for protected apartments and prices — which have risen at a much slower pace than that found in non-protected apartments.

Premium under erosion

The analysis data shows that since October 2023, demand for protected apartments has indeed risen sharply in the rental and search market, but transaction prices for old apartments without a Mamad have risen faster than prices for apartments from the Mamad era.

The result — the price premium per square meter for apartments from the Mamad era, meaning the addition that buyers paid for the protection, has eroded from about 25% in 2023 to about 19% at the end of last year, and according to partial data for 2026, it continues to fall and has reached about 16%.

"The main conclusion is that the market today prices two different values: a residential value, in which a Mamad is very important to the tenant and the buyer looking for immediate use, versus a land/renewal value that exists in old buildings without a Mamad, mainly in areas with an expectation for Pinui-Binui (evacuation and construction)," says Zilber.

According to him, "an old apartment without a Mamad is a weaker residential product, but in areas with renewal potential, that same apartment embodies an option for a new building with Mamads. In a period of increasing security threat, the value of the renewal itself rises — and therefore many buyers do not price only the quality of the existing apartment, but what can be built in its place."

In our estimation, another factor interfering with the different price dynamics of protected apartments versus those without is the new apartment market, especially those whose occupancy date is relatively short, which compete mainly with second-hand protected apartments.

Since 2023, the supply of unsold new apartments has been growing, which forces developers to launch various promotions, and creates a situation where owners of protected apartments have "ceiling prices" that they find it difficult to exceed, otherwise buyers will prefer to purchase new apartments. This limits the ability of apartment owners in various places to raise their prices significantly.

The conclusion is that although the war has greatly strengthened the demand for protection, the transaction market does not translate this in a simple way into a higher "Mamad premium." Therefore, anyone trying to draw conclusions about an apartment's value only according to the question of whether there is a Mamad or not might miss a central part of the picture.