Investing in luxury real estate in Israel: criteria of profitability


It is no secret that Real Estate is a reliable and profitable investment. Elite housing with its prices and criteria of profitability stands out here. So, employees of real estate agency Israelapartments managed to find out that the high cost of an exclusive object does not always mean that it will bring a significant profit in the future. In this segment there are both underestimated and overestimated options. Therefore, choosing to invest in expensive real estate it is worth paying attention to the main criteria of profitability and practical advice from specialized realtors. Luxury real estate in Israel at

Types of exclusive housing: townhouse, villa, penthouse, apartments

Luxury property in Israel

The first thing an investor should do is to choose what type of luxury real estate he is going to invest in:

  • Villas – mansions of luxury level, most often designed for a pleasant short-term vacation. However, if desired, they are also suitable for year-round living.
  • One- and multi-level apartments. Such housing in townhouses and club apartment buildings is considered elite. Note that one-story flats are more popular than multi-story apartments.
  • Penthouses are luxury class apartments, usually occupying the entire top floor of an apartment building. Penthouses are valued on the main streets of megacities, in historical districts of the city, as essential privileges for residents: beautiful views from the windows, a separate entrance, their entrance to the parking lot, and a minimum number of neighbors.
  • Townhouses are complexes of low-rise cottages with shared walls and (sometimes) a roof. One such complex comfortably accommodates 2-4 families – each with a separate entrance, a beautiful terrace, and a backyard. Townhouses are built both outside the city and in busy areas of megacities.

When choosing this or that type of elite housing, familiarize yourself with its project: clever realtors sell townhouses as villas at the appropriate price.

What affects the profitability of luxury real estate: from location to liquidity

Objects, united by the general concept of “exclusive housing,” bring their owners not the same income. Much depends on the following four criteria:

  1. Location. For the city: the closer the real estate object to the center and historical districts, the higher its price. Outside the city, exclusive houses in luxury villages are considered: the closer to the sea, lake, and reservoir, the more comfortable for beach vacation shore, the more expensive it is.
  2. Liquidity. In other words, how quickly can you sell this object at market value? The central pain of luxury housing is that it is often overvalued, from which the search for a buyer can stretch for 1-2 years.
  3. Contingent. For future buyers and tenants, neighbors on social and financial status must be at the same level as they are. In the matter of exclusive housing being highly valued and privacy – the fewer neighbors, the higher the price you will be offered for the object.
  4. Individual design. It is impossible not to mention unique architectural interior solutions. Here, we can even talk about a particular price within the framework of a closed sale.

Consider such an essential factor as the situation in the real estate market “here and now.” In the case of luxury housing, it is not always financial crises and global upheavals that necessarily lead to a drop in prices and demand.

How to estimate the value of exclusive real estate

We already know that when buying deluxe housing, you must pay attention to each option’s location, liquidity, individual design, and surrounding contingent. In addition, housing lawyers recommend two things to check as a must:

  • The history of ownership of the property. Simply put, it is vital to find out on what basis the house was built. If there was an illegal remodeling or reconstruction, such an option should not even be considered an Investment. When the seller is a developer, he is obliged to put all the documents for the apartments in open online access. Check which bank gives mortgages to the developer’s clients. If it is a well-known and respected institution in your country, the risks with the purchase are minimal.
  • The status of the land rights. When buying a villa or townhouse, ensure that the land plot under the building is owned by the developer or under a long-term lease from the city administration. Otherwise, a self-built building may be legally demolished.


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