Raanana real estate – the year that was

 

It is quite safe to say that if Raanana real estate prices were heading in the direction of Hertzliya Pituach and Savyon, ironically the recent Operation Protective Edge, accelerated this trend.

Demand dynamics are the essential element propelling Raanana real estate prices upwards.

The  strongest factor behind an increased demand for rental and sales properties stems from immigrants and potential immigrants from Europe. The continued uncertainty and physical stress within many European Jewish communities experienced a spike during Operation Protective Edge.

Already on the map as a destination of choice for a wide variety of immigrants, Raanana  attracted a record breaking number of new immigrants in the summer of 2014.

It is too early to accurately assess the effects of this increased demand, as there is normally a lag-time in which the market recalibrates pricing. However it is early enough to say that pricing for newer, modern apartments  is at least 4 or 5 % above 2013 prices. Newer, modern apartments of 4 rooms with 100 sqm were selling for NIS 2,100,000 in 2013. Now they are selling for NIS 2,200,000.

When it comes to measuring luxury properties, Raanana becomes even more closely aligned with the pricing of Hertzliya Pituach and Savyon. With the immigration of wealthy foreigners to Raanana the demand for luxury homes continues to increase. Home sales in the range of NIS 10 million – NIS 15 million are no longer an exception. Homes in this category have appreciated by approximately 10% per year over the last few years. Luxury homes generally stand on plots of 370/400 – 750 sqm, with home sizes of between 350 sqm to 550 sqm, and have been built within the last 2 / 3 years.

As for the standard plots of 370 sqm to 380 sqm with older homes, where they are located in areas with strong Anglo and other immigrant communities, such homes sell for NIS 4,600,000 (generally to be demolished) to NIS 6,000,000 where the homes are renovated and provide at least 10 more years of comfortable usage. The supply of these homes is consistently weak with attendant price increases. These homes have likely appreciated 7-9% per year over the past few years

It remains to be seen what the coming year will bring. However I would bet on further price increases, based on the after effects of the large immigration Raanana is currently experiencing.