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Extracts from Jerusalem Post article written by Sarah Hershenson, and featured in the Metro supplement on 24th August 2007.

THE BRITISH ARE COMING!

The numbers of Jews from Great Britain buying property in Israel to be used as vacation/investment homes, or as permanent dwellings, has risen steadily over the past two years.
Many young families, as well as retirees and grandparents, are coming to Israel with typical British reserve and no great fanfare.

According to the aliya organization Nefesh B'Nefesh, the number of British olim has almost doubled over the past five years, from 323 in 2002 to 612 in 2006. Of the projected 600 arrivals this year, over 400 are coming through Nefesh B'Nefesh.
The Jewish population of Great Britain numbers between 350,000 to 450,000, comprising under 0.25 percent of the total population of the UK.

Just as historians now concur that Revolutionary War hero, Paul Revere, did not shout the famous phrase "The British are coming!" while on his Midnight Ride, but rather spread the message quietly, the Jews from Great Britain are now calmly sending the message that "This is the time for British Jews to come, buy, and live in Israel."

Through the years, Netanya has had a reputation as a city with a large, strong, and active English-speaking community, becoming a magnet for British and American immigrants in particular.
Socially, the British are active. The HOB (Hitachdut Olei Britannia) is one of the organizations specifically devoted to helping people from Britain with their aliya questions, car, or apartment, purchases, in addition to its community service and social programs in Netanya.
HOB membership in Netanya currently stands at about 600 persons.
"Living close to a synagogue was always a factor for British Jews, and it's a deciding factor when they come to Israel," says HOB President, Pearl Zilka.

Nevertheless, Jews from Britain are taking a great interest and buying into the new buildings in South Beach near the Carmel Hotel.
"The British have been major players in every upscale real estate market in Israel," says Barry Shaw of Netanya Real Estate.
"They have outstripped the French in the more expensive locations in the country, and this is most evident in the South Beach area between Herzlia Pituach and Netanya where every apartment in the best projects is British-owned."

Shaw points to three regal-sounding luxury apartment buildings in various stages of construction - Royal Residence, Presidential Palace, and Duet - as representative of what the British want, noting that they have larger rooms, sea views, Shabbat elevators, beautiful lobbies, swimming pools, and gyms.
These apartments were sold before the buildings went up, based on their plans and high quality. One and a half years ago they were sold at $300,000 for a three bedroom apartment, a price that Shaw believes will double when they are finished in 2008.

The South Beach is the newest development area of Netanya, and has a synagogue close by the Carmel Hotel. The municipal policy plans foresee the South Beach as an area into which the city will be moving, and have zoned for more synagogues, restaurants, shops, cafes, and tourism.
Shaw sees more British families and couples in their 40s and 50s buying these apartments for permanent residences, future aliya, vacation dwellings, and investment.

In Britain, property is selling at a high. The pound is strong, and coming to Israel and buying property should be viewed by more British as an opportunity.
With more Brits joining those already here, it appears that Paul Revere was right, regarding Netanya.

Featured in the Jewish News. 8th February 2007.

It was clear, back at the end of 2005, that interest in prime location quality properties in Irael was increasing. This was particularly felt from Britain.

Israel real estate offices were receiving a greater demand for sea front vacation homes from English buyers.
At that time, and in early 2006, there were few new properties being offered with the added features and facilities required by the British buyer.
These features include larger sun balconies, sea views, swimming pools, gyms, and Shabbat elevators.

South Beach has become a status symbol, and highly desirable location, for selective British and American property buyers who demand top quality and properly maintained buildings.

South Beach is the new, upmarket, seafront location along the Mediterranean shoreline between Netanya and Herzlia Pituach, north of Ramat Poleg.

From the future perspective of next summer, current prices in South Beach will seem low.
Rapidly rising land values, together with increasing costs of building materials, must inevitably lead to much higher prices for projects to be offered through 2007.

Knowing that Net Real Estate has a high concentration of quality British buyers, builders are keen to discuss with them their upcoming projects.
Those builders willing to include the style and features demanded by discerning British buyers are selected by Barry Shaw of Net Real Estate for their clients.

Builders are already hinting at the prices of their upcoming projects that Net Real Estate will be marketing during the summer of 2007.
They will be higher than those sold throughout 2006.

Herzlia Pituach prices are through the roof to the extent that they are completely out of proportion.
It is possible to find a private villa with at least five rooms and a private pool in the garden for less money than a three bedroom apartment on the sea. This makes no sense whatsoever, save for the fact that the mass of buyers prefer an apartment (which is in very limited supply) than a house.

Furthermore, it is possible to buy into superior designed apartment buildings in South Beach for $5000 per square meter against paying over $18,000 per square meter in Herzlia Pituach or Tel Aviv.

This difference in value for money, together with the superior and newer buildings, is driving many British buyers to South Beach.

Those who bought in certain Eilat projects near the Red Sea last year have seen significant capital appreciation.
Net Real Estate – Israel sold many apartments in Amdar Village to British buyers. Prices today have increased with recent developments in Eilat.
Barry Shaw os offering a couple of luxury furnished duplex apartments for resale in the fabulous Laguna complex in Eilat.
The Laguna is built on the quiet waters of a lagoon not far from the Herods Hotel.
The fifty units in this secure complex include owners of El Al, Superpharm, Pelephone, and Israel's leading lawyers and architects.
Laguna is an exclusive hideaway that is largely unknown by British vacationers.

There has been an increase in activity in Raanana. This has been led by an increase in families from France, Britain, and America making their Aliyah into this central town which is within easy communting distance of Tel Aviv.
Prices have risen, especially in the larger villas.
Net Real Estate – Israel has helped a number of British buyers find their new homes in Israel and in Raanana during 2006. This trend will continue during 2007.

"There are many good reasons to invest in Israel right now," says Barry Shaw.
"In many ways Israel is an investors paradise. There are lots of incentives to buy, including tax benefits."

Barry Shaw of Net Real Estate recently organised a series of free Israeli Property Forums in Manchester and London where the latest information was available.

Barry Shaw told the Jewish News that "the thrill of helping people find their new homes and investments in Israel adds a special dimension to our work. It feels like performing a mitzvah every time we help somebody find their place in Israel.
Buying a property in Israel is a good, practical, and profitable investment. But, above all else, it is such an emotional and moving experience."

The English are Coming!

By Ariel Rosenberg. Globes article - 8.1.2007.

The most significant rise in property purchases in Israel in the last year was not from French or American buyers, but from the British.

Changes in the law relating to pension plans will bring the potential for another spurt of British investors, perhaps not confined to Jewish buyers.

Builders, home owners, and real estate agents, mainly in Netanya, Jerusalem, Herzlia Pituach, Eilat, and Tel Aviv have felt, in the last two years, the invasion of British property investors into Israel.

A dramatic change in British law opens an opportunity to Israeli developers to offer their projects to an additional wave of British investors.
More than 300,000 Jews live in Britain today.

Lawyer Raymond Goodman, Elevator to Sironit Beach - Natanya from Liverpool, explained, in an interview with Globes, that a British investment law of 2006 that came into law on 6th April, allows British citizens to invest in overseas properties from their personal pension plan, known as SIPPs.
The revised law grants tax relief and allows the pension money to be used by investing in properties abroad.
The pension plan holder can decide how and where to invest his money. Income from the investment is returned into the personal pension fund and is exempt from tax. Furthermore, property purchase is free from British capital gains tax.
Potential investments in Israel and the world are residential and commercial properties subject to a number of conditions.
Whoever dreams of wholesale buying of vacation homes from Britons are wrong. The tax exemptions do not permit British SIPPs investors to use properties for personal use, but only for investment purposes only.
Despite this, the ease in tax to a level of 100% gives potential profits in two years of up to 215,000 Sterling.

One of the limits to purchasing a residential property is the prohibition for the investor and his immeidate family to own more than 10% of the property. The investment must cover at least three properties, or one property valued at a minimum of one million pounds Sterling.

Goodman, aged 51, spends several weeks a year at his vacation home in The Laguna in Eilat. He says that he is involved in explaining the new pension regulations with British investors in Spain, America, Bulgaria, Croatia, and the Caribbean. Today he is talking with Israeli developers on the possibility of drawing in British pension funds into Israel.
"I believe there is a significant opportunity for Israeli developers," says Goodman.

Goodman, who has a staff of over eighty, including twenty five lawyers in his Liverpool law firm, Goodman Solicitors, says he has opened the model of syndications for investing money from pension funds.
"A relatively small investor with 40,000 Sterling in his fund can, through tax benefits of up to 40% can, in a syndicate of twenty people, raise 1.12 million pounds Sterling and, with the new regulations, get a loan of up to 50% of the sum.
Though it is not permitted to hold more than 10% in any one syndicate there are no limits to the number of syndicates that each SIPP can invest."

Goodman works with pension fund managers who hold clients portfolios in overseas investments.
According to Goodman, the British are looking for attractive investments showing good medium and long term returns in places like Spain, Croatia, and Bulgaria. Developers with suitable projects can do good business. Attractive products must have good rental income, significant increase in value, and good management.
Goodman also sees potential for Israeli banks. It is difficult to raise loans from British banks for a SIPPs investment in Israel, but if Israeli banks will understand the principle of this method they can create loans against the property, and their financing is low risk.

Ray Goodman agrees that the natural investors are British Jews but, if Israelis think correctly they can reach a wider British market that is looking for good investments.
"The Israeli market is more sohpisticated than Eastern Europe, and more attractive," says Goodman.

Despite the problems here, the balance of payments in Israel says something to the British about the strength of the Israeli economy.

Natanya Beach Jews buy a lot in Costa del Sol in Spain because it is easy to get to but, because of price rises there, it is time to set foot in Israel.
"Lots of projects are sold to the British and when I ask buyers of vacation homes in Spain why not buy in Israel, in Eilat for example, they say there are no golf course."
Apart from creating golf courses Ray Goodman recommends to Israeli developers to establosh investment management teams for the British, and to work with British financial consultants, real estate agents who truly understand the British, and big Jewish investors, to open the doors to investments in Israel.

Barry Shaw, who owns Net Real Estate based in Netanya, is excited by the increased British interest that has added significantly to the success of his real estate business that is today over 90% British.
Shaw explained that Israelis are wrong when they think that the main overseas buyers are French.
"The British have more buying power than the French, and they are buying more prime location properties than the French, but they do it far more discreetly. They do not make the noise or publicity of the French. It's part of the British character."

Most of the staff in Barry Shaw's office are British or English speakers.
"The British ecomony is stronger than the French economy. Britons can permit themselves to buy more expensive properties than the French."

Shaw explains that, despite the accepted view that the French control the prime location property market in Israel, in places such as Netanya, South Beach, and in Herzlia Pituach, the majority of the overseas buyers arrive from Britain.
"The French say they do not have the funds to buy in these places, so they go to Ashdod or to Eilat."

Most of the properties sold by Barry Shaw are for vacation use, or vacation use prior to a future Aliyah.
"Many are now buying for investment because some in Britain believe the Israeli economy has a better future than the British economy."

Shaw, from Manchester, explaiend a few British characteristics for buying in Israel.
He pointed to the huge amount of British buying in South Beach, a small stretch along the southern Mediterranean coastline between Netanya and Herzlia Pituach.
"Builders who are willing to add features and services demanded by the British for their vacation homes enjoy a wealth of buyers despite relatively high prices. The British do not object to pay more if there is added value."

British tastes prefer large sun balconies facing the sea, a high standard in the technical specification, installed central air condition systems, heated swimming pools, Shabbat elevators.
"The British do not like being tricked by Israeli builders. They are not willing to pay high prices for luxury apartments and, after they have signed, be expected to pay extra for air conditioning, underground parking, etc. Builders are obliged to give high standards and quality in their buildings in order to satisfy the British buyer."

Shaw told of several seafront projects in South Beach near Netanya that were sold exclusively to British buyers. Some builders are prepared to fir themselves to the demands of the British who are buying all the new apartments before start of construction.
"Despite this, there are still a lot of builders who are stubborn and tell me 'I will build what I know to build, and sell to whoever wants to buy'. My answer is that they can't expect to see our British buyers in any great numbers."

Shaw said that, apartment from South Beach, the British are buying in the Nitza area of North Netanya, Herzlia Pituach, Raanana, and close to the sea in Eilat.
"Jerusalem is strictly for the religious buyers, and the younger religious families buy in Ramat Bet Shemesh, Modi'in, or in East Netanya."

Shaw certainly believes that the new changes in pension fund regulations can open the Israeli real estate market to new British investors.
"The investment patent of the new pension plan enables Britons to buy land and build, for example, ten apartments or houses, so that each one having a 10% interest in the project will have a property each.
I have a plot of land where it will be possible to buy the land and build apartments at a cost of $140,000 instead of $180,000 by virtue of saving on local property taxes. If the syndicate wishes to sell the apartments, and the individual has not sold another property in Israel in the last four years, he can receive the profit tax free, and benefit from Israeli tax exemptions." Ben Avi Blvd. Natanya

Rental income in Britain is at a higher percentage than in Israel but, with property prices at record levels and, generally Israeli prices at a low level, it allows for significant capital appreciation exempt from capital gains tax on the investment in Israel.
In Britain, inheritance tax stands at 40%. This has encouraged some to invest in Israeli real estate where there are no death duties or inheritance tax.

Another factor, according to Barry Shaw, is that British Jews have a special feeling in their heart for Israel. "In Bulgaria they can, perhaps, receive a better return, but they do not only look at the financial advantage when they invest in Israel."

Shaw pointed to the blossoming of new projects to English buyers.
"Whoever bought in prime location projects one and a half years, and even just one year, ago for $300,000 can sell in certain buildings today for between $450,000 -$500,000, and there is a very strong market for such resale properties."

Shaw gave examples of three buildings (Royal Residence, Presidential Palace, and Duet) where one hundred and ten apartments were sold to British buyers, plus a further fifty apartments in the same area were also bought by British families.

Builders are standing in line because only the Brits are ready to pay half a million dollars for a four room apartment in a luxury apartment block with pool, gym, Shabbat lift, and underground parking.
"For Brits this is 'only' 250,000 Sterling. Ask anyone in London what they can buy for this price? Maybe a studio flat somewhere."

As long as the price is considered cheap by the British, and as long as the Sterling/Dollar exchange rate holds up, there is a window of opportunity.
Shaw feels that the British desire to buy in Israel will continue until the end of Summer 2007. He thinks that, by then, there may be a shift in the exchange rate and also, by then, most Brits with money would have made their investments in Israel and the opportunity window will slam shut.
Shaw also characterised project investments that appeal to British buyers.
"Location! Facing the sea, or facing the Old City of Jerusalem. Buy off plan before builders start the building process to get the best prices. Buy in a building where people like you are buying. This will ensure that you are buying into a building that will be maintained to the high standard that you expect. For example, would you expect the lobby and common parts to be cleaned every day or only once a week, as in most Israeli controlled apartment buildings? The British are ready to pay a higher 'Vaad' fee to ensure excellent maintenance.
"The best way for builders to sell to the British is to plan, at an early stage, for the special demands and requirements. This is something that other real estate offices do not do. There are a lot of builders we cannot help because they are not willing to work to our standards. We are ready to sit with their architects and make recommendations, such as round balconies, and sexy and beautiful buildings that the British like. As a result, buildings are sold quickly. You have to understand the head and the heart of the British."

The 'Duet' project in South Beach, for example, was marketed by Shaw's office. There were large apartments and penthouses but, for three months, only one of two apartments were sold due to having square balconies.
"The builder said that these balconies were more functional. This was all well and good but, from the moment he changed the shape of the balconies to rounded ones, within a month and a half we sold eighteen apartments at prices between $395,000-$480,000, leaving just three to be sold. And construction did not start until two months later. If builders start to understand the needs of the British I can promise to convince the British to buy."

Mati Monk, of the international section of Bank of Jerusalem, said the British invasion began four to five years ago, though the window of opportunity started two years ago since Sterling reached 1.8 to the Dollar. This made things easier for Britons to buy in Israel.
Also changes in rax laws encouraged overseas people to buy here.
According to Monk, discomfort with the rising Islamic presence, and recent anti-Semitism in England, makes many feel it is good to have a place in Israel.
Monk identifies a sharp rise in property purchase in Netanya and Jerusalem. Monk estimates that the British bought over $300 million of Israeli properties in 2006.
British understand that to buy a property abroad you need a local expert to supervise your investment, and most British have someone, or a company, to manage their assets here.
With the strong economy, Israel has become an attractive place, not only to have a residential home, but also to invest further.
"Nearly all the projects in Israel are of interest to real estate investors broad."
Mark says that Tel Aviv is of interest, but to a lesser degree, to the British. Netanya is extremely popular to Jewish communities in Brtain partly due to the existing British religious and social community there, and their connection to friends and families in London and Manchester.
Builders are advised to present one or two happy British buyers who have bought in their projects, and they will do their work for them.
"British prefer to buy in newer areas where values will rise."
Monk advises builders, "There is some lack of trust in the Israeli system., You need someone of British origin to represent you."

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