Mar 18, 2014

Lapid's plan to make housing cheaper

Finance Minister Yair Lapid today announced his plan to make housing cheaper and more affordable for young couples.. Lapid's plan consists of lowering the VAT on the first apartment purchase of a young couple - lowering it all the way down to 0% (from 18%), effectively giving young couples an 18% discount.

The qualifications for this discount would be that:
1. it applies only when buying a new apartment direct from the kablan
2. at least one spouse in the marriage has served n the IDF
3. the married couple has at least one child
4. they will not be allowed to sell the apartment for a minimum of 5 years

while one might say this plan is clearly prejudiced against the haredi community, considering the recently passed draft law that will theoretically increase the draft in the haredi community, it might not actually be so. Possibly, Lapid's plan is partially to encourage, using the carrot this time, more haredim to willingly be drafted - 18% is a lot of money to save.

Housing Minister Uri Ariel says this project will not withstand the test of the Supreme Court and will be canceled for being discriminatory. Ariel wants the program expanded to include haredim and couples with no children, as well as not just limiting it to first-apartment-purchases.. Ariel says this is what will truly affect housing prices, and not just the first purchase which is only 8% of the home purchases.



  1. I've been following this story this morning and it is full of holes:
    - Uri Ariel raised this plan over seven months ago.
    - Last night, the PM himself called a meeting to discuss the plan, but nothing finalized
    - Lapid jumped the gun this morning in order to enjoy the limelight
    - it is only a plan, no law has been passed
    - criticism raised about the one child + clause. Why can't a childless couple enjoy this benefit?
    - this plan is not 'against Haredim' but rather to support those doing national service
    - Arabs have fought successfully in the past not to join housing benefits, but rather to rescind them.
    - Motivating young couples to buy new apartments from contractors is a bit 'dumb' for a number of reasons:
    - young people are more gullible negotiators to contractors which will then pursuade the buyers to add extras (the kind that are very profitable to contractors like light switches for instance) because 'you are already saving so much money',
    - many brand new apartments in the central area are in high rise apartment buildings which have very high 'vaad bayit' maintenace costs that young couples realize only after moving in. I pay 150NIS in a low building, my friends pay 500 and up for obligatory fees like fire department checks, the elevators working all the time, the water tank and pump on the roof, the cleaning people, and of course the maintenance company,

    1. what do you think about my idea that maybe this is a carrot to assist the haredi draft numbers?

    2. Long term, maybe (but laws like this are usually not long-term, and canceled). Short-term - definitely not. Lapid and Bennet just exempted tens of thousands. Or maybe, it's another brilliant idea to motivate non-Haredim to buy new apartments in RBS. hmmmm.

      IMO, I don't see anything wrong with a law giving benefits to people who have done national service. In another era, this surely would have increased the Haredi draft, but that changed thanks to Bennet-Lapid.

      - Globes reports tonight that this would possibly benefit a whole whopping 8% of the housing market.
      - this is only relevant for middle class and up who are in the market for 'new'
      - His Finance Ministry clerks are totally against the plan
      - speculation that 'young couples' will now sit on the fence waiting for this law to pass
      - law discriminates against single parents and singles in general.

      Lapid's latest bubble tonight is putting a limit on rent for three years. Instead of introducing proper rent controls, he's still blowing smoke with ideas.

  2. First of all, taking off the VAT is "only" about a 15% reduction. (An OK mistake for a blog, but I hope our Finance Minister didn't make the same mistake). Second, what if the person was exempted from IDF service due to illness, or if he is one of the 1800 "elite" torah scholars Yesh Atid has been touting?

    1. Yoni,
      Duh, it's 18% me'le'bar :-)

  3. Of course, screw the charedim some more.

    Another day with another anti-charedi proposal, another day with God reminding us who the real enemy is.
    So far charedim aren't putting IED devices against IDF jeeps.

    1. "Unknown", you are correct that "So far charedim aren't putting IED devices against IDF jeeps," but in fact the Chareidi leadership *is* in fact setting up the cultural, linguistic, and ideological underpinnings of the Chareidi terrorist (lo aleinu), who is probably at most a generation away.

  4. kol b'rama talking heads were of the opinion that the courts won't allow discriminating in this way

  5. Unknown wrote -- "Of course,screw the charedim some more."
    POINT A --> for years the haredim controlled the housing ministry and screwed the non-haredim by having the level of the gov't assistance dependent on the number of brothers and sisters of the purchaser (what does this have to do with anything? it was a way for the haredim to selectively increase subsidies for haredim. If you can't take it, don't dish it out. Don't call other Jews amalek and then cry about 'haredi bashing' -- CHOOSE ONE.
    POINT B --> there is no one stopping haredim from going to the army (many already do) and from working (many already do). In the United States there is the GI bill giving benefits to veterans -- is that also out to 'screw the haredim.' ???

  6. This is so dumb. They're increasing demand for the same supply - no way that can possibly bring prices down.


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