Property prices in Israel are expensive, and rental yields are poor

Residential Valuation Specialist | November 10, 2022

Last Updated: Oct. 02, 2022
TEL AVIV-YAFO - Apartments COST ($) YIELD (p.a.)
TO BUY MONTHLY RENT
Center
Studio $667,280 $1,200 2.16%
1-Bedroom $1,036,414 $2,442 2.83%
2-Bedroom $1,405,548 $4,244 3.62%
3-Bedroom $1,845,669 $10,932 7.11%
Tel Aviv-Yafo (all locations)
Studio $509,536 $1,026 2.42%
1-Bedroom $969,876 $1,898 2.35%
2-Bedroom $1,290,357 $2,390 2.22%
3-Bedroom $1,657,223 $3,233 2.34%
4+Bedroom $2,063,447 $4,076 2.37%
Tel Aviv-Yafo avg. Rental Yields 3.05%
JERUSALEM - Apartments COST ($) YIELD (p.a.)
TO BUY MONTHLY RENT
Center - Yafo Street
1-Bedroom $614,249 $1,352 2.64%
2-Bedroom $707,274 $1,846 3.13%
3-Bedroom $1,320,813 $2,812 2.55%
Jerusalem (all locations)
Studio $328,915 $843 3.08%
1-Bedroom $524,295 $1,068 2.45%
2-Bedroom $688,753 $1,286 2.24%
3-Bedroom $829,314 $1,968 2.85%
4+Bedroom $1,065,458 $2,502 2.82%
Jerusalem avg. Rental Yields 2.72%
HAIFA - Apartments COST ($) YIELD (p.a.)
TO BUY MONTHLY RENT
Center - Lower city
Studio $190,311 $795 5.28%
1-Bedroom $311,030 $795 3.07%
2-Bedroom $332,334 $895 3.23%
Haifa (all locations)
Studio $111,747 $548 5.89%
1-Bedroom $231,927 $703 3.64%
2-Bedroom $328,915 $843 3.08%
3-Bedroom $475,099 $1,153 2.91%
4+Bedroom $736,544 $1,462 2.38%
Haifa avg. Rental Yields 3.68%
BE´ER SHEVA - Apartments COST ($) YIELD (p.a.)
TO BUY MONTHLY RENT
Center - Neighborhood C
1-Bedroom $185,908 $540 3.48%
2-Bedroom $236,468 $710 3.60%
3-Bedroom $281,205 $937 4.00%
4+Bedroom $374,940 $1,264 4.05%
Be´er Sheva (all locations)
Studio $163,052 $506 3.72%
1-Bedroom $171,485 $562 3.93%
2-Bedroom $224,899 $703 3.75%
3-Bedroom $299,397 $928 3.72%
4+Bedroom $446,986 $1,251 3.36%
Be´er Sheva avg. Rental Yields 3.74%
RA´ANANA - Apartments COST ($) YIELD (p.a.)
TO BUY MONTHLY RENT
Ra´anana (all locations)
2-Bedroom $756,222 $1,588 2.52%
3-Bedroom $924,194 $2,080 2.70%
4+Bedroom $1,012,045 $2,460 2.92%
Ra´anana avg. Rental Yields 2.71%
All yields are gross - i.e., before taxes, repair costs, ground rents, estate agents fees, and any other costs. Net yields (what you´ll really earn) are typically around 1.5% to 2% lower.
Source: Global Property Guide Definitions: Data FAQ See also: Update Schedule

Get updated rental yields data for 75 countries

Gross rental yields i.e., the rental return on a property if fully rented out, before all expenses, are poor in Israel - almost at Monaco-like levels. Gross rental yields for apartments are near or under 3% (though some areas have higher yields).

This tends to support the popular view that property is somewhat overpriced in Israel.

Tel Aviv is a more expensive city to buy or rent property in generally than Jerusalem. In both cities, prices have risen strikingly. Prices in Tel Aviv for a two-bedroom apartment range from US$1,290,357 to US$1,405,548 whereas in Jerusalem a two-bedroom apartment ranges from US$688,753 to US$707,274.

Renting a two-bedroom apartment in Tel Aviv would cost you anywhere from US$2,390 to US$4,244 per month. Renting in Jerusalem for a similar property is likely to cost you US$1,286 to US$1,846 per month.

Despite Tel Aviv´s higher purchasing price, it generally generates higher yields. The city´s average rental yield is 3.05%. In Jerusalem, it is 2.72%, Haifa´s average rental yield is 3.68%, Be´er Sheva´s average rental earning is 3.74% and Ra´anana has an average rental yield of 2.71%.

Round trip transaction costs are low to moderate on residential property in Israel, with most costs paid by the buyer. See our Israel residential property transaction costs analysis and Round-trip transaction costs in Israel compared to the continent