Being prepared for your property search will give you a massive advantage in Jerusalem real estate. You are in the early stages of purchasing real estate, but there are things that you can do that will ensure success when the time is right. What exactly does being prepared look like? Let’s take a look at three things to plan for your purchase in Jerusalem.
Walking around the different neighborhoods on your next trip to Jerusalem will familiarize you with the areas in which you are interested. Speaking to friends and family about the areas that they live in will also help you boil down your list of potentials. You do not want to come into your property search with a list of five different neighborhoods; you will want to be a bit more focused on specific areas.
Awareness of Closing Costs
Many times, my clients are shocked to learn about the high closing costs. As a foreigner buying in Israel, your closing costs will be 11.5 % +. With a minimum 8 %purchase tax, 2 % +VAT agent fee, and a 1 % +VAT (approximately) lawyer’s fee, these costs are not low. Additionally, if you plan on moving money or taking out a mortgage, you will also have to pay transfer fees and possibly a mortgage broker. While these are the major ones, there are other small fees. You must be aware of these fees because they will affect your budget. You do not want to find a property that you love and realize that you can’t afford it because of the closing costs.
Do Not Expect Negotiations
Do not look at properties 10-15 % more than your value unless your broker absolutely tells you that the seller is desperate and will close below the asking price. There is generally 0-3 % negotiating room on properties currently in the market. When I say 0 %, I mean 0 %. Many sellers and developers will not sell below their asking price because they believe 100 % that they will get the price they are asking.
Anything that you can do to prepare and not waste time will help you immensely in your property search. As a broker, I do not want to show you 20 properties if 18 of them are irrelevant. Whether there is no elevator and you need one, if you insist on parking and there is none, or if your budget is 5 million shekel and the properties are worth 7 million. These rules can change for some people, but in general, you should know what you want and stick to it within reason. If you only have three or four days to look at real estate, make sure you take advantage of all of that time and come prepared.
If this stage sounds like you, where you have prepared these things but are not necessarily ready to buy, have a meeting with your broker. Whether it is via Zoom or in person, it will be the starting point of the process. If you just show up in Israel and say you are looking to purchase, that is perfectly fine. However, a good one or two meetings sitting down, explaining the process, and figuring out what it is you are looking for is extremely important and helpful and establishes a relationship with your broker. All of that should be done before you come to Israel to ensure your time is used the right way.
These are the thoughts of CapitIL Real Estate Agency Sales Director Ben Levene. To start your property search in Israel, please email [email protected] or call +972-53-822-4336.