Q2 2026: new construction sales up 38%, secondary market down - Full CBS report analysis

Full analysis of the CBS report "Apartments in Real Estate Transactions", April–June 2026

Published August 13, 2026

In the second quarter of 2026, Israel saw 22,636 apartment sales — 11.7% higher than a year ago. Compared to the previous quarter, the market remained nearly flat (−0.6%), but internally there was a dramatic shift: new construction gained 38%, while the secondary market turned negative.

What the quarter showed

All market growth came from new construction. The secondary market didn't just lag behind — it shrank. Buyers are moving away from private sellers toward developers, and the reason is clear: developers now offer selection, discounts, and flexible payment plans, while private sellers are far more reluctant to cut prices.

One-third of new construction sold under state programs

Every third new apartment in Q2 was sold under a state subsidy program. This is an important correction to the "market grew 38%" headline: the free market growth is more modest — roughly 6,500 apartments versus 5,000 a year earlier.

Month by month: April collapsed, May and June pulled through

April dropped by nearly half — it's a month of holidays and short work weeks, a pattern that repeats every year. June, however, was the best month of the half-year: 8,807 transactions.

Unsold apartments remain at record highs

The inventory barely moved — it declined less than 2% since December. The "months of supply" metric, however, fell significantly: from 30.5 to 26.0. The difference is simple: we're dividing by higher sales rates rather than subtracting from the inventory.

Twenty-six months of supply is still a deep buyer's market. Normal is considered 12–18 months; above 18 tips the balance toward the buyer.

Prices heading down, rents heading up

Developers prefer cutting prices over halting sales — with this much inventory, it's the only way to move stock. Landlords, meanwhile, are raising rates: rental demand is growing precisely because some people are postponing purchases.

What buyers should do

1. Negotiate. With 84,000 unsold apartments, a discount, finish bonus, or flexible payment schedule isn't rude — it's standard negotiation practice.
2. Compare with subsidized projects. One-third of the new construction market runs through state programs; if you qualify, that's a different price point.
3. Don't rely on national averages. Price differences between neighborhoods in the same city can reach one-third of the per-meter cost — always calculate for your specific neighborhood and real transactions.

All figures are calculated directly from the CBS report tables. Quarterly totals are the sum of monthly values; verified for consistency with annual lines in the report.