BUYING IN ISRAEL | Bain Realtors

Your Essential Guide: How to Buy a Home in Israel

Step-by-Step Guide to Buying a Home in Israel

Buying a home in Israel is a unique experience compared to purchasing abroad. The process involves various legal, financial, and procedural steps that can feel overwhelming. To help you navigate this journey smoothly, here is a structured guide outlining essential steps, key considerations, and helpful tips. Whether you're a first-time buyer or an experienced investor, understanding these aspects will empower you to make informed decisions.

Step 1: Define Your Budget and Financing Options

1. Consider your budget – Consider your available cash, mortgage options, and any additional costs (taxes, fees, and renovations).

2. Mortgage Pre-Approval – If financing, consult with banks or mortgage brokers to determine your borrowing capacity. Israeli banks will typically finance up to 75% for first-time buyers and 50% for foreign buyers.

If you’d like to explore different financing options, Bain Realtors can recommend skilled English and Hebrew speaking mortgage brokers that will provide you with a free consultation!

Step 2: Find the Right Property- That’s where Bain Realtors comes in!

1. Choose a Location – Consider factors like schools, transportation, community, and future development. Looking for your next home or a summer apartment on the beach? Bain Realtors can help you find your next property!

2. Determine your timeline- looking to move next week, this summer, or next year? Bain Realtors will help you find a property that works for your timeline. Whether you're looking for a property to move to in a few months or wishing to buy a property off plan from a builder, Bain Realtors can help you!

3. Visit Properties – Bain Realtors will help you explore and visit different options and compare prices, condition, and potential resale value.

Step 3: Due Diligence and Legal Review

Hire a Real Estate Lawyer – Israeli property laws are complex. A lawyer ensures the property has no legal issues (liens, debts, zoning restrictions) and protects your interests.

Bain Realtors can recommend multiple high quality and professional Real Estate lawyers that can provide you with a free consultation!

Step 4: Make an Offer

1. Negotiate the Price – Bain Realtors will help you prepare an offer and negotiate the price and payment terms. Once agreed upon, the lawyer will begin looking over the contract.

Step 5: Sign the Purchase Agreement

1. Sign a Binding Contract – Your lawyer will draft and review the contract to protect your interests.

2. Pay the Down Payment – Typically 20%-30% is paid upon signing. Payment terms vary by property.

3. Register a Caveat (He’arat Azhara) – Your lawyer registers your purchase with the Land Registry (Tabu).

Step 6: Pay Taxes and Fees

1. Agent fees and lawyer fees are due upon signing the purchase contract.

2.Purchase Tax (Mas Rechisha) – Paid within 60 days of signing. The rate depends on your residency status and property value:

• Israeli citizens (first home): 0%-5% depending on the price bracket.

• Foreign buyers / second-home buyers: 8%-10%.

To calculate the Purchase tax on your home in Israel, click here

Step 7: Mortgage and Final Payments

1. Secure Your Mortgage – Provide documents required by the bank and complete the mortgage approval process.

2. Final Payments – The remaining balance is usually paid in installments per the contract schedule.

Step 8: Transfer of Ownership and Registration

1. Final Inspection – Ensure the property is in agreed-upon condition before the final payment.

2. Receive the Keys – Once all payments are made, the seller transfers possession.

3. Register the Property – Your lawyer will update the Land Registry (Tabu) with your name as the new owner.

Step 9: Move In and Set Up Utilities

1. Transfer Utilities – Register electricity, water, gas, and municipal taxes (Arnona) under your name.

2. Renovations and Moving In – If needed, plan any renovations before moving in.

Bain Realtors is happy to provide recommendations for electrician, contractors, repairmen, designers, etc.

Final Thoughts

Buying a home in Israel involves careful planning, legal oversight, and financial preparation. Working with Bain Realtors (and our team of experienced professionals )—will ensure a smooth process.