Israel: Selected Issues

Publication Date: February 12, 2014
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Summary: This Selected Issues paper examines the housing market in Israel. Property prices in Israel are currently about 25 percent above their equilibrium value, owing largely to low mortgage interest rates and supply shortages. Price-to-income and price-to-rent ratios are well above their equilibrium value. The risk of a sharp correction in housing prices—although mitigated by the supply shortages—remains a concern and could have important macro-financial implications. To contain such risks, macroprudential policies should be further tightened. At the same time, concerted efforts should be made to alleviate supply-side constraints.
Series: Country Report No. 14/48
Subject(s): Article IV consultation reports | Fiscal policy | Housing | Monetary policy | Macroprudential Policy | Economic models | Selected issues | Israel | Housing prices

Publication Date: February 12, 2014
ISBN/ISSN: 9781475590142/1934-7685 Format: Paper
Stock No: 1ISREA2014002 Pages: 45
US$18.00 (Academic Rate:
US$18.00 )
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