Everyone is waiting to see whether Israel will finally have a stable, long-term government that can make operative decisions for the good of the country, or if we will again have to endure rotation and interim governments.
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The current situation is having an impact on the largest market in Israel – housing and infrastructure. The market has been experiencing uncertainty for the past year and a half. There is a shortage of construction workers and no mechanism for rezoning lands for development and issuing permits.
The number of tenders has dropped dramatically, with no solution in sight to the need to build thousands of apartments and expand infrastructure for Israel's growing population. The apartment supply, in the meantime, is decreasing, while demand is on the rise and prices are climbing. If this trend continues, there will be less and less apartments for sale and prices will skyrocket. Add to that the lower purchase tax on investments and lower interest rates on mortgages, and what you get is a market bubble.
To address these issues, the management of the housing market should be separated from the Housing Administration. An operative administrative unit should be created, made up of professionals who can develop a well-oiled operative mechanism to dramatically reduce paperwork and shorten land rezoning processes. Such a unit will also supervise and issue construction tenders and analyze the complex of factors delaying the construction of thousands of new apartments.
Of course, one of the obstacles is the market regulation imposed by the Ministry of Finance. The Ministry should free Israel from the ridiculous notion that Israeli workers will join the construction sector.
The import of many foreign workers and the removal of the obstacles mentioned above will shatter the glass ceiling, secure employment for thousands of Israeli workers in industries that support the construction sector, and propel the market to new heights and unbounded economic growth.
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The coalition agreements signed by the members of the new government, an administrator or minister should be appointed who can charge forward without fear, take the sector under control, and assume responsibility for all the accompanying issues. That is the only way we can extricate ourselves from the housing crisis. The State of Israel needs an operative housing cabinet and a senior logistics executive to lead the sector into the future.
Eldad Nitzan is chairman of the Association of Foreign Workers' Manpower Corporations in the Construction Sector
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