If you’re reading this article, you probably live somewhere in the Baltimore area and you probably like it, and I can understand that. I grew up in Baltimore before moving to Israel, and I have only pleasant memories of that town.
Some people want to come to Israel and come, and some want to but don’t. I would like to suggest a third possibility, whereby you keep your options open and do yourself some good in the meantime. I’m talking about buying a home in Israel.
In plain, realistic terms, I think buying in Israel is a good idea. Whatever your reasons, it makes financial sense. It’s a good investment. The fact is this: The Jewish population is growing, through births and immigration, and sometimes immigrations are large and unexpected. This growth increases demand, raising prices. Likewise, as the country grows, as mass-transit improves, new areas of the country are constantly becoming more attractive. With today’s excellent trains running north-south along the entire coast, the south and north are not as far from the center as they used to be. Jerusalem is about to be 25 minutes from Tel Aviv, thanks to the high-speed train that is nearing completion. The country is getting smaller. The same is true in Judea and Samaria, where I live, which is gradually becoming an accepted part of the country. So prices are rising there as well, but they are still relatively low.
Naturally, in the Knesset they debate how to lower housing prices, but they are fighting against natural processes that will go on until the Mashiach comes. These processes were more striking in the past, but they are still very relevant now.
Here’s a rule: At any point in time during the past 70 years, it was easier to purchase a home in Israel one year before than it was a year later. The deals you can strike today are not as good as the ones you could have struck 10 years ago, and they are probably better than the deals that will be available in 10 years.
I am no financial wizard, but consider the following: In 1986, my wife and I bought a four-room, 87-square meter apartment in Kiryat Arba, at a time when there were 3,500 Jews living there, and slightly over four million people living in the whole country, less than a third of world Jewry. I didn’t buy that home as an investment – far from it. A few years before, my parents had discouraged our moving to Kiryat Arba because of the perceived dangers. The obvious investment in those days was the newer neighborhoods in Jerusalem. We felt no danger, had no fear, and we bought the home in Kiryat Arba, an 11-minute walk from Me’arat HaMachpela, just because we liked the town and wanted to live there. At that time, the general perception was that Kiryat Arba, an “ideological settlement far over the Green Line,” would eventually be evacuated. When I would go to my month of army reserve duty, soldiers from the Tel Aviv area would always ask me, as a sort of entertainment (a replacement for television) “What will you do if you are evacuated?”
The four-room apartment we bought cost us $29,000. Seventeen years later, for an additional $50,000 in private construction costs, we added two rooms, a large balcony and a bath/shower. Today, with the specter of evacuation largely gone, and 10,000 residents in Kiryat Arba, and 49 percent of the Jewish People living in the Land of Israel, my apartment is considered by all accounts to be worth $250,000. So it was a good investment even without our trying.
By contrast, I grew up in a lovely home on Glen Avenue. It had four stories, many rooms, lots of great places for a ten-year-old-kid to hide, and beautiful front and back lawns. In Jerusalem today, that home would easily be worth three million dollars. We loved that home. Yet 10 years ago, when my parents tried to sell it, they had to accept far less than it was worth. Still, there were no regrets. The home served us. I grew up in it. Nothing can take my childhood away from me. But I think the point is clear.
To buy a home in Israel, first you need to decide what it is you want. If you’re just buying it right now as an investment, you don’t have to like what you’re buying or its location. You can buy it, rent it out, and then sell it. My wife and I know of an American lawyer who bought a one-room apartment in Lod, in a neighborhood where prices were starting to rise, without any intention of ever living there. One of his daughters, a resident of Judea and Samaria, wanted to buy a home where she lives. The man waited while prices rose, renting it out in the meantime. Now he has it to sell. The money from the sale will go to the daughter to enable her to buy the home she wants, and he’s giving her more than he could have otherwise.
We know another family that did exactly the same thing not once but six times, once for each of their six children. Not everyone is psychologically built to engage in such an activity (me, for example), but the possibility is there, and if you invest a bit of time to ask some questions, you can do it.
You can also buy a home in a place where you might actually want to live someday. You’ll probably want to ask questions such as “Where is it, what kind of people live there, what kind of homes are they, and how much do they cost?” Yet because of the general trends I described above, you’ll probably do well wherever you decide to buy. I’ve never seen anyone buy a home in Israel and lose out. You’ll buy the home, and then you’ll have the home in the Land of Israel more or less waiting for you. You can rent it out and pay for your mortgage with it.
Sometimes people don’t want to rent out their apartments because they are afraid that renters will do damage, but over the course of a year, with the tenants covering Jerusalem municipal tax, the owner will earn a lot of money, and the tenants won’t do much damage. The owners can fix whatever damage there is for relatively little, and profit from the high Jerusalem rents. Renters also give the owner a chance to see what needs fixing in the apartment.
Breathe deeply for a few technical details: To begin this process, you do need money. To receive a mortgage in Israel, the bank wants to see you put up 40 percent of the cost of the home. That means that for a million-shekel home, you need $120,000 up front. On the remaining 60 percent, you will probably pay 1.8 times the original amount including interest, assuming a 25- or 30-year mortgage.
You can do a lot with a million shekels. In Rechavia, in Jerusalem, you can’t buy a bike shed with a million shekels, but for 650,000 shekels, you can buy a four-room (i.e., three-bedroom) private home with a front and back yard in one of the towns in the Southern Hills of Hebron. A new road about to be constructed will make that area 10 minutes closer to Jerusalem than it presently is and raise prices, but that hasn’t happened yet.
With a million shekels you can buy a nice, large, private home in Nevei Tzuf in Samaria, 10 minutes from Modi’in, or a new five-room apartment in Kiryat Arba, in a building with an elevator and a breathtaking view. For 700,000 shekels you can buy a nice, old (“old,” as in built in the 1970s) four-room apartment in one of the old neighborhoods of Kiryat Arba.
Another up-and-coming place is Lachish, sort of southwest of Beit Shemesh. That’s another place with relatively low prices that is going to become more and more central as time goes on. And as in Judea and Samaria, there are all kinds of Jews there: chareidim, national religious, and secular.
When we bought a home for one of our sons a few years back, it was recommended to us to hire an Israeli mortgage advisor for about 5,000 shekels. He represented us at the bank, attaining for us the best mortgage deal he could, better than the bank would have given us if we had gone ourselves to negotiate it. My understanding is that he saved us a lot of money in what my son will have to pay over the coming years, so we recommend that.
Four years ago, I actually helped one Baltimore family, who shall remain nameless, to buy an apartment in Kiryat Arba. I went around with them, as a local realtor showed them five apartments. In the end they chose the one that suited their budget, and in the past four years, the apartment, which they bought for 530,000 shekels, has gone up in value to almost 700,000 shekels. They choose to leave the apartment empty, but when they visit Israel, they’ve got a place to stay, walking distance from Me’arat HaMachpela. If they choose to rent the apartment out, that can cover their monthly mortgage payments.
But what about Beit Shemesh? What about Gush Etzion? What about Jerusalem? I don’t know much about any of them, but I know people who know. If you email me, I’ll put you in touch with people who live there, including former Baltimoreans. Looking up places on their websites is also a good source of useful information and contacts. Each town has people who are waiting for people like you to call.
Since I’ve spent this whole article discussing dollars and cents, I will permit myself to conclude with one philosophical point: At present, almost half of the Jewish People are in the Land of Israel. Could a time come when there will not be enough room in the Land of Israel for all the Jews?
Five hundred years ago, the Maharal asked this question, and his answer was a definite no. In his book, Netzach Yisrael, he asks, “Why is the Land of Israel called Eretz HaTzvi, The Land of the Deer? (Daniel 11:41).” Notwithstanding that Baltimore, too, has become the land of the backyard deer,” why, indeed is Eretz Yisrael called that?
He answers that when a deer is alive, its skin covers its whole body, obviously. Once the deer dies, however, if you remove the skin, it contracts, and you are left with something that cannot possibly be stretched over the body of a deer.
It is the same with the Land of Israel. When the Land lies empty, it becomes lifeless and desolate. Anyone seeing it assumes that it cannot possibly hold any more Jews, let alone the entire Jewish People. Yet as Jews arrive, the Land comes alive and its opportunities expand, so there are always opportunities for more, until the last Jew arrives.
May we witness with our own eyes the expansion of the Land of Israel’s potential as all the remaining Jews come home to the Land, and may we merit to see Mashiach soon.
Raphael Blumberg is a translator who offers tours of Hebron. Contact him at rdb1000@actcom.net.il.
