Rental Market

A check by the Madlan website reveals that the Neve Sha'anan neighborhood in Haifa is the most sought-after for rent this summer, followed by Nachlaot in Jerusalem and central Herzliya. What are the reasons that the 'City on the Carmel' is ranked high in the top ten, and where are the neighborhoods in Tel Aviv?

The rental market in Israel shows a 4.8% price increase compared to July 2025. The primary driver is a severe shortage of large apartments, with supply dropping by 25% year-over-year, particularly in the southern regions.

Apartments without protected spaces have become the default choice for tenants unable to afford higher rents. In some cities, the price gap has peaked since the start of the war. A report by the Yad2 website highlights the growing disparity in the secondary housing market.

July data reveals significant supply gaps: while small apartment availability has recovered, a 25% shortage in large units persists, driving a 4.8% annual price increase.

Financial reports from REIT funds for the first half of 2026 reveal significant delays in the delivery of hundreds of apartments. This results in delayed occupancy and lost rental income, with several cases now heading to court.

Yad2 data shows that in Jerusalem's Beit HaKerem and Tel Aviv's Sarona, rental prices rose by double-digit percentages over the past year, significantly outpacing the 4.4% national average. Increases for three-room apartments were sharper than for four-room units, though some Tel Aviv neighborhoods saw price declines.

An analysis of apartment indices in the second quarter of 2026 shows that the middle class currently prefers not to buy an apartment, and that renters are turning to rent cheaper and lower-quality apartments. The average price for an apartment purchased during the quarter reached 2.435 million shekels - an all-time high.

Tax Authority data reveals that during the war, the number of real estate investors in Israel grew at a much higher rate than single-apartment buyers. The most significant increase, 20%, was recorded among those holding nine or more apartments.

The Israeli rental market is now governed by new Ministry of Justice regulations establishing a default contract. These rules clarify responsibilities for repairs, deposit limits, and procedures for early termination.

The apartment-moving season is in full swing, rent is rising, and apartment landlords need to check whether they must report to the Tax Authority on rental income and, if so, which track to choose. Globes has compiled for you all the questions, options, and relevant data.