AHC Index Results

Results Analysis - Price for the Dweller

Relevance for deciles 3-7

Grading – projects

Pass: 222 projects

Fail: 105 projects

Grading housing units

Pass: 15,975 units

Fail: 10,854 units

Grading cities

Pass: 31 cities

Fail: 12 cities

Discount from market price

Grading – projects

Pass:

145 projects offer reductions of more than 30%

Fail:

180 183 projects offer reductions of less than 30%

Grading housing units

Pass: 8,716 units

Fail: 18,113 units

Distribution based on discount rates

.Discount rate 0-9%: 4 projects

.Discount rate 10-19%: 33 projects

.Discount rate 20-29%: 146 projects

.Discount rate 30-39%: 116 projects

.Discount rate over 40%: 29 projects

Average discount rate for all projects: 29%
Highest discount rate: Beit Dagan – 47%
Lowest discount rate: Nazareth Illit – 8%

Correlation between discount rates and relevance to deciles

Discount rate higher than 30% and final price is relevant for deciles 3-7

Discount rate lower than 30%

Discount rate higher than 30% but irrelevant for deciles 3-7

Grading – projects

Projects graded 'pass' on both criteria:

Discount rate + relevance for deciles 3-7

 

Relevance for 7th decile: Eilat, Ashkelon, Beit Shemesh, Harish, Atlit, Pardesiya and Kiryat Motzkin

Relevance for 6th decile: Dimona, Harish, Lod, Nazareth and Rekhasim

Relevance for 5th decile: Ofakim, Migdal HaEmek and Shlomi

Relevance for 4th decile: Nazareth and Afula

Projects graded 'pass' on discount rate

But not on relevance for deciles 3-7

 

Relevance for 10th decile: Herzliya

Relevance for 9th decile: Mevaseret Zion

Relevance for 8th decile: Beit Dagan, Rosh HaAyin, Rishon LeZion and Ramla

105 projects out of 327 (32%) were graded pass on both the discount rate (over 30%) and relevance for deciles 3-7.

 

39 projects out of 327 (12%) offer a discount greater than 30%, but do not offer prices that are affordable for middle to low income households.

 

Projects with the highest rate of discount (47%) that are nevertheless unaffordable for deciles 3-7, are found in Beit Dagan and Rishon LeZion.

The Shchunat HaPark project in Ofakim offers the highest discount (43%) of all projects relevant to deciles 3-7.

Ability to create an available housing supply for the long run

Since the program offers housing solutions for sale and not for rent, the only beneficiaries are those who win the lottery.

 

Once they have purchased the unit, they are subject to only one restriction: they cannot resell for a period of 5 years.

Thus all 'Price for the Dweller' projects fail with regard to creating a supply for the long run.

Eligibility criteria

The program's only criterion for eligibility is not being a homeowner.

Therefore all projects fail with regard to eligibility criteria.

Relevance for deciles-based on location

The average socioeconomic grading of the towns/cities with a passing grade is Cluster 5.

 

Ashkelon, Beersheba and Haifa are the only ones among Israel's 14 large cities (with a population of over 100,000), in which most projects were graded pass.

 

Projects graded pass enable winners to pay a monthly mortgage of 2,042 NIS (Ofakim) to 4,751 NIS (Beit Shemesh).

Number of towns/cities that provide an average solution for the relevant decile

Number of cities

An absolute majority of the passing projects are located in towns/cities graded high (1-3) in the Periphery Index of the Central Bureau of Statistics.

 

*Exceptions: Beersheba, Haifa, Nesher, Atlit, Kiryat Motzkin, Ashkelon and Beit Shemesh – graded 5-6 in the Periphery Index, as well as Lod, Pardesiya and Kfar Yona, which are more centrally located.

Relevance for 7th decile: Eilat, Ashkelon, Beersheba, Beit Shemesh, Haifa, Yokneam Illit, Kfar Yona, Carmiel, Merkaz Shapira, Nazareth Illit, Nesher, Atlit, Pardesiya, Kiryat Gat and Kiryat Motzkin

Relevance for 6th decile: Dimona, Harish, Lod and Rekhasim

Relevance for 5th decile: Ofakim, Hatzor HaGlilit, Yerucham, Migdal HaEmek, Mitzpe Ramon, Sderot and Shlomi

Relevance for 4th decile: Nazareth and Afula

Relevance for 10th decile: Herzliya and Raanana

Relevance for 9th decile: Jerusalem, Mevaseret Zion and Netanya

Relevance for 8th decile: Beit Dagan, Gedera, Yavne, Kiryat Bialik, Rosh HaAyin, Rishon LeZion and Ramla

Results Analysis - 'Apartment for Rent'

(Projects built in state-owned land promoted by the government)

Ability to create an available housing supply for the long run

10 year limit: Jerusalem, Ramat HaSharon, Herzliya, Tel Aviv, Rishon LeZion

All projects included in the survey create affordable housing for a period of 10 to 20 years.20 year limit: Kfar Saba, Raanana

 

20 year limit: Kfar Saba, Raanana

Eligibility criteria

Since criteria for eligibility for rental projects have been changed over the years, increasing flexibility and adapting them to criteria for the Price for the Dweller program

In the current format, with no income test, there is no way of making sure that units in this program will offer supervised prices that can be afforded by middle and low income populations

Discount from Market Price

Even though all projects included in the survey were graded pass on the criterion of relevance for deciles 3-7 (relevant for deciles 6-7), none were found to offer a supervised price with a discount of over 30%.

Average discount rate for all projects: 21%

Lowest discount rate: HaGadna Project, Tel Aviv (12%)

Highest discount rate: Morasha Project, Ramat HaSharon (28.7%)

The number of housing units offered for rent through the government is quite limited – only 2,498. Only 762 of these are offered at supervised prices.

These projects are situated in 8 local authorities, mostly in high-demand areas: Herzliya, Haifa, Jerusalem, Kfar Saba, Risho LeZion, Ramat HaSharon, Raanana and Tel Aviv-Jaffa.

Number of housing units per city 

Relevance for Deciles 3-7

These projects do offer affordable housing in high-demand areas. However, the solutions are quite limited, since units offered at supervised prices are relevant only to middle income households - of the 6th and 7th deciles.

Relevance for 6th decile: Raanana (Neot Uzi), Jerusalem (Chomat Shmuel & Hadassah HaKtana), Rishon LeZion (HaRakafot)

Distribution based on housing units

Units affordable to the 7th decile: 307

Units affordable to the 6th decile: 237

Relevance for 7th decile: Kfar Saba (HaZemer HaIvri) Ramat HaSharon (Morasha), Herzliya (Glil Yam) Jerusalem (Allenby)   

Results Analysis – Local Authorities

Discount from Market Price

Projects initiated by local authorities are able to offer prices that are 38% lower, on the average, than market prices.

Lowest discount rate: Shchunat HaKalaniyot, Rishon LeZion (30%)

 

Highest discount rate: Michelangelo project, Tel Aviv (48%)

Correlation between discount rates and relevance to income deciles

Projects graded 'pass' on discount rate but not on relevance for deciles 3-8

 

Herzliya (Emma Tauber)

43% discount, relevance for deciles 8 and up

 

Kfar Saba (Givat Eshkol)

32% discount, relevance for deciles 8 and up

 

Kfar Saba (Yair Rosenblum)

35% discount, relevance for deciles 8 and up

Relevance for deciles 3-7

Only 7 affordable housing projects advanced by local authorities, offering a total of 418 housing units, provided sufficient data for analysis.

Relevance for 7th decile: Rishon LeZion (Rishonim Tower)

Relevance for 6th decile: Rishon LeZion (Shchunat HaKalaniot)

Relevance for 5th decile: Tel Aviv Yafo (Ganei Shapira & Michelangelo)

Relevance for 3rd  decile: Tel Aviv Yafo (Yad Eliyahu)

Relevance for 8th decile: Herzliya (Emma Tauber), Kfar Saba (Givat Eshkol & Yair Rosenblum)

2 projects for sale

1 project for sale

2 projects for sale

3 projects for rent

Number of housing units per city

The only projects offering housing that is affordable for middle and low income households are advanced by the Local Authority of Tel Aviv Yafo.

 

Two projects offering units for sale in Rishon LeZion enable affordable monthly payments for deciles 6-7, but only if purchasers can show equity of 230,000-270,000 NIS.

© 2014 The Affordable Housing Center