Buying Property in Israel as a Foreigner: The Complete Guide
Updated: 4 days ago
Buying property in Israel as a foreigner: the short answer
Yes, foreigners can buy property in Israel. You don't need citizenship, residency or an Israeli bank account to sign. What you do need: a good local lawyer, about 8% of the price set aside for purchase tax, and at least 50% of the price in cash if you plan to take a mortgage.
That's the easy part. The hard part is everything around it. You're buying in a country where you may not speak the language, don't know the lawyers, and can't drop by the apartment on a Tuesday. Most overseas buyers we meet aren't worried about whether they can buy. They're worried about who to trust.
This guide walks through the whole thing in the order it actually happens: ownership rules, the buying process, taxes, costs, mortgages, the team you need, and what happens after you get the keys. Each section links to a deeper guide if you want the detail.
Figures below are as of October 2026. Purchase tax brackets are frozen until January 15, 2028. Always confirm your own numbers with your lawyer.
Can a foreigner own property in Israel?
Yes. A foreign resident can buy an apartment or house in Israel on largely the same terms as an Israeli. There's no quota and no special permit for a normal residential purchase.
The twist is the land itself. Most land in Israel, roughly 93%, is state land managed by the Israel Land Authority (ILA, Rashut Mekarke'i Yisrael). Instead of owning the ground outright, the apartment owner holds a long-term lease, usually 49 or 98 years and routinely renewed. That's how most Israelis hold their homes too, so it doesn't hurt resale value. In practice, you own your apartment; the state owns the dirt under the building.
What this means for you:
Check how the property is registered. Your lawyer pulls the land registry extract (nesach tabu) or, for new buildings, the registration at the ILA or a housing company. This shows who owns it, any mortgages, liens or warning notes.
ILA land can carry extra paperwork. Some transfers of ILA leasehold to foreign residents need ILA consent, and leases sometimes have unpaid capitalization fees. Your lawyer handles this, but ask about it early.
Freehold exists too, mainly on privately owned land and in some older city neighborhoods.
More detail: Can Foreigners Buy Property in Israel? and our Israel real estate legal guide.
How buying property in Israel works, step by step
A typical second-hand purchase takes 6 to 12 weeks from offer to signed contract, and you don't have to be in Israel for most of it.
Set your budget, including tax. Price plus about 8% purchase tax plus 3 to 5% in other costs. If you need a mortgage, get pre-approval before you shop.
Hire your lawyer first, before you make an offer. In Israel the buyer's lawyer does the due diligence, writes or reviews the contract, and registers the property.
Find the property. Through agents, Yad2, or a buyer's representative who searches on your behalf.
Negotiate, but don't sign a "memorandum." A zichron dvarim (memorandum of understanding) can be legally binding. Let your lawyer handle anything in writing.
Due diligence. Land registry extract, building permits, municipal debts, an appraisal (shuma) if you're borrowing, and an engineer's inspection.
Sign the contract. Usually a first payment of 10 to 20% at signing. Your lawyer registers a warning note (he'arat azhara) the same day to protect you.
Report and pay purchase tax. Report within 30 days of signing; pay within 60 days.
Pay the balance and take the keys, usually over 2 to 6 months in installments.
Register ownership in the land registry (Tabu) or with the ILA. This can take months after you move in.
Can't be there? You can sign through a power of attorney, notarized and apostilled abroad or signed at an Israeli consulate.
More detail: Israel real estate due diligence checklist and 7 myths about buying in Israel.
Purchase tax for foreigners (mas rechisha)
A foreign resident pays 8% purchase tax on the full price up to ₪6,055,070, and 10% above that. There's no tax-free first bracket, because the sole-residence discount is only for Israeli residents. These brackets are frozen until January 15, 2028.
Price band | Foreign resident or additional home | Israeli resident, only home | New immigrant (oleh), first home |
Up to ₪1,978,745 | 8% | 0% | 0% |
₪1,978,745 to ₪2,347,040 | 8% | 3.5% | 0.5% |
₪2,347,040 to ₪6,055,070 | 8% | 5% | 0.5% |
₪6,055,070 to ₪20,183,565 | 10% | 8% | 8% |
Above ₪20,183,565 | 10% | 10% | 10% |
Worked example: a ₪3,000,000 apartment
Buyer | Purchase tax |
Foreign resident | ₪240,000 |
Israeli resident, only home | ₪45,538 |
New immigrant (oleh) | ₪5,106 |
That gap is why timing matters. Olim get the reduced rate on one home, generally if they buy within seven years after aliyah. Buying before aliyah and claiming the rate later has its own deadlines, and the rules have changed more than once. If aliyah is on your horizon at all, talk to your lawyer about this before you sign.
More detail: Israel purchase tax guide for foreign investors. To check your own number, use the Israel Tax Authority's purchase tax simulator on gov.il.
Other closing costs
On top of purchase tax, budget roughly 3 to 5% of the price for everything else. Typical ranges (all fees plus 18% VAT):
Cost | Typical range | Notes |
Lawyer | 0.5% to 1% of price | Second-hand. On new builds the developer’s lawyer also charges, often capped by the contract |
Real estate agent | Up to 2% of price | Only if an agent introduced the property |
Appraiser (shama’i) | ₪2,000 to ₪4,000 | Required by the bank for a mortgage |
Engineer’s inspection | ₪2,000 to ₪5,000 | Depends on size and age |
Mortgage broker | Flat fee or ~0.5% of loan | Optional, often pays for itself |
Currency conversion | 0.2% to 2% | Banks charge the most. Shop around |
Registration fees | A few hundred shekels | Plus ILA fees on some leasehold land |
For a ₪3,000,000 apartment, a foreign buyer should plan on about ₪330,000 to ₪390,000 over the price once purchase tax is included.
More detail: Closing costs when buying property in Israel.
Mortgages for foreign residents
Israeli banks lend to foreign residents up to 50% of the property's value. Israelis buying their only home can borrow up to 75%, so as a foreigner you need at least half the price in cash, plus taxes and costs.
What else to know:
Your income is assessed from abroad. Expect to provide translated payslips or tax returns, bank statements, and FATCA or CRS forms (a W-9 for Americans).
Bank of Israel rules shape the loan. At least one third must be fixed-rate, terms run up to 30 years, and the monthly payment can't exceed half your income. Banks usually want it well under that.
Currency risk is real. If you earn in dollars, pounds or euros and borrow in shekels, a currency swing changes your effective payment. Some buyers choose non-indexed tracks to reduce exposure.
You can sign remotely, at an Israeli consulate or before a notary with an apostille.
A mortgage broker helps. Rates and terms vary a lot between banks, especially for foreign residents. A good broker runs the process and negotiates across banks.
More detail: Getting a mortgage in Israel as a foreigner.
The team you need
In Israel, nobody on the deal is responsible for the whole deal. The agent wants a signature, the bank wants collateral, and the developer wants the next payment. You need people who work for you.
Role | What they do for you | When you need them |
Real estate lawyer | Due diligence, contract, warning note, tax reporting, registration | Before the offer |
Mortgage broker | Pre-approval, comparing banks, negotiating terms | Before you shop |
Appraiser (shama’i) | Independent valuation, required by the bank | After you agree on price |
Engineer | Inspection for defects, illegal additions, damp | Before you sign |
Accountant | Tax planning, rental income, residency questions | Before you sign, if you’ll rent it out |
Buyer’s representative | Finds properties, coordinates everyone, is your eyes on the ground | From day one |
That last role is what we do at Keys to Israel. We don't replace your lawyer or broker. We bring the team together, keep it moving, and make sure nothing falls through the cracks while you're 9,000 kilometers away. And before you sign on anything, our Pre-Purchase Review gives you a second opinion on the property, the building, the price and the renovation cost, with a clear answer: buy, negotiate or walk away.
More detail: Property inspection services in Israel and why coordination beats browsing.
New build or second-hand?
New builds (al hanyar, buying "on paper") usually cost less upfront and let you pay in stages, but you wait 2 to 4 years and carry developer risk. Second-hand apartments cost more per square meter in good areas, but you see exactly what you're buying and can rent it out right away.
New build | Second-hand | |
Payments | In stages over construction, often linked to the construction cost index | 10 to 20% at signing, balance over 2 to 6 months |
Your protection | Sale Law guarantee from the developer’s bank on every payment | Warning note in the land registry |
Main risk | Delays, developer finishing quality | Hidden defects, illegal additions |
Rental income | Not until delivery | From day one |
Either way, get two things before you sign: an appraisal, so you know the price is fair, and an engineer's inspection, so you know what you're buying. For new builds, the inspection happens at handover, and it's worth every shekel.
We've done both. Our Mazkeret Batya new build and Beit Shemesh rental units show what each path looks like in practice.
More detail: Buying new vs. second-hand in Israel and How to read an Israeli appraisal report.
Renovating and managing from abroad
Getting the keys is the halfway point. Most overseas owners either renovate, rent the place out, or leave it empty for visits, and each comes with its own problems when you're not there.
Renovating: get fixed quotes, pay against milestones, and have someone independent check the work before each payment. Most horror stories start with paying ahead. See renovating in Israel from abroad and renovation costs in Israel.
Renting it out: long-term gross yields run about 3 to 4% in most cities. Know the Fair Rental Law, register the income, and use a written contract. See rental yields explained and Israel rental laws for overseas landlords.
Leaving it empty: someone needs to check it regularly for leaks, mold and mail, and pay the arnona (municipal tax). See managing vacant property in Israel.
Our Herzliya stair project is a real example of a renovation managed for an owner abroad.
Frequently asked questions
Do I need to be in Israel to buy?
No. You can sign everything through a power of attorney. Most buyers visit at least once to see the property and meet their lawyer.
Do I need an Israeli bank account?
Not to sign, but you'll need one to take a mortgage, pay the seller, and pay municipal tax and utilities. Opening one as a foreign resident takes a few weeks, so start early.
How much purchase tax does a foreigner pay?
8% of the price up to ₪6,055,070, and 10% above. On a ₪3,000,000 apartment that's ₪240,000.
How much can a foreigner borrow?
Up to 50% of the property's value from an Israeli bank.
Can I get my money out again when I sell?
Yes. Declare that the purchase is funded with foreign currency, and keep the paper trail. Your lawyer handles this at signing.
Is it better to buy before or after aliyah?
If aliyah is a real possibility, the oleh rate can save you hundreds of thousands of shekels. Get advice before you sign anything.
Your next step
You don't need to have everything figured out to start. Most of our clients came to us with a city in mind and a lot of questions. Talk to us about your situation, or see how we help buyers. We also run regular webinars for overseas buyers with lawyers and mortgage brokers. Prefer to know the cost first? See our fixed prices, or book a free 20-minute call.
About the author: David Bitton is the founder of Keys to Israel and has been investing in Israeli real estate for over 20 years, buying, renovating and managing property in Mazkeret Batya, Beit Shemesh, Netanya, Tel Aviv, Ra'anana and Modiin. He made aliyah from Toronto, so he has been through the same process as his clients, and he speaks English, Hebrew, French and Spanish.
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