Home prices in Israel continued to inch downwards in January and February 2026, dropping by 0.1 percent year-on-year for the second consecutive month, according to the most recent information available from the Central Bureau of Statistics.

The average price of homes has fallen 10 out of the last 12 months, leading to a 1.7% decline over the last year, CBS said.

Israel’s housing market has slowed over the past year, partially in reaction to the multifront war Israel has been engaged in since Hamas invaded southern Israel on October 7, 2023. High interest rates, a record supply of unsold new housing, and high prices have also helped to tamp down sales. The shekel’s strength against the dollar, currently at a 30-year high at NIS 2.98, is also affecting demand from overseas buyers.

The latest CBS figures do not reflect the impact of joint US-Israel strikes on Iran in March and April, which is believed to have slowed the market even further.

During the two-month period, prices fell by 0.7% in Jerusalem and Tel Aviv. Prices rose by 0.9% in the north, 0.5% in the center district, 0.3% in Haifa, and 0.2% in the south.

Over the past 12 months, prices have risen by 4% in Jerusalem, 2.2% in the north, 0.4% in the south, and 0.5% in Haifa. Prices declined by 5.1% in Tel Aviv and 3.1% in the central district.

According to Finance Ministry data for February, a total of 7,187 apartments were sold, a 3% decline from a year earlier. The number of transactions rose 4% from the previous month, even after excluding government-subsidized housing.

New apartment sales, including government-subsidized units, totaled 2,520 units, representing a 13% drop compared to February 2025.

A total of 4,667 secondhand apartments were sold, marking a 3% increase compared to February 2025, with little change from the previous month.

Investor activity showed some growth, with 1,171 apartments purchased by investors, a 6% increase from a year earlier. In the same period, investors sold 1,321 apartments, unchanged compared to February 2025.

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© The Times of Israel