In October 2023, the shekel was at a low point against foreign currencies due to the uncertainty brought by the war. Since then, the Israeli currency has been steadily recovering. This trend has many positives, but there are also drawbacks for apartment buyers who pay in foreign currency and discover that that currency is now buys much less in a country where the shekel is the main currency. These differences that can be worth hundreds of thousands of shekels, and for buyers who are not extremely wealthy, this change can be the difference between a purchase and taking a step back.
Gabay Group VP marketing Orit Gabay Tirer says, “Recently, we have been meeting a growing clientele of foreign residents who do not belong to the classic, high-wealth group of buyers. Many of them come with limited equity, sometimes based on the sale of a property or on savings accumulated over years. For these clients, currency rates are not a theoretical figure but a factor that determines deals. We see cases of customers who have already chosen an apartment, gone through the financing process and were even close to signing, and then stopped or postponed the decision because of a change in the exchange rate, which created a significant economic gap compared with what they had planned.”
How significant are the numbers? Since the low of October 2023, the shekel has gained about 21% against the US dollar from NIS 4.04/$ to NIS 3.19/$ today. In less than six months, from June 2025, the shekel gained by 5% against the dollar. In October 2023, the euro was worth NIS 4.27/€, and is today worth NIS 3.74/€ – a gain of 12.5% for the shekel.
“This was a not particularly rich person”
Any such change in the foreign exchange rate means that foreign currency held by buyers is “worth” less shekels. “In a case I recently encountered, the change in currency rates created a gap of over NIS 500,000, for an apartment in Tel Aviv that cost around NIS 5 million,” says Maor Ohana, CEO of Our Way mortgage consulting network, which also assists foreign residents in the process of purchasing an apartment in Israel. “This was a not particularly rich person, a resident of France approaching retirement age, who saved some capital throughout his life. But an addition of about NIS 500,000 was significant for him.
“This is an issue that has always existed for foreign residents interested in buying an apartment in Israel, but today it stands out more, because of the significant strengthening of the shekel and because of the increase in anti-Semitism, which is causing more and more middle-class foreign residents to consider moving to Israel. These are not the same foreign residents we usually hear about, who buy another property in Israel just in case.”
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Dror Ohev Zion, CEO and owner of Dara Project Managing, says: “Let’s take for example a 10% fall in the shekel-dollar exchange rate – this is a very significant amount of money: even for an apartment worth ‘only’ NIS 3 million, that’s a difference of NIS 300,000, almost $100,000. However, even in such periods there are still purchases and Americans, for example, are still buying apartments in Israel.”
Home purchases in Israel by foreign residents in recent times have been quite low. Total purchases by foreign residents in October was only 96 apartments, down 13% from October 2024, according to the Ministry of Finance chief economist, which notes that the declines in this segment have actually continued since April 2024. The vast majority of foreign residents purchase apartments in Jerusalem – 44% of all apartments purchased in October. Sales by foreign residents have actually recorded a certain increase since July, up 32% from the same period last year.
24K Luxury Properties in Israel owner and CEO Avraham Kopelovich, who markets projects to foreign residents, mainly in Jerusalem and Safed, markets projects to foreign residents, mainly in Jerusalem and Safed, says that in the luxury market the impact is much smaller: “If the rate drops from NIS 3.5/$ to NIS 3.2/$, in a deal worth NIS 8 million, the increase is more than $200,000. Between the start of negotiations and the moment of signing, there can certainly be an increase of hundreds of thousands of dollars. In most cases, I handle deals with a wealthy population, for whom this is usually not their first property in Israel, and for whom these differences are not very significant.
“What mainly supports the sale of apartments in Israel to foreign residents is the strengthening of the US economy. There have already been three straight interest rate cuts. This drives the economy.”
For high-tech professionals: What happens when the bonus is in dollars?
The strengthening of the shekel not only affects foreign residents. Nir Shmoul, CEO of Snir Real Estate Marketing Group, says: “I encountered this dilemma in an increased way about a year ago, and first of all from high-tech professionals, Israeli residents, who made an exit or who have options waiting to be exercised, and everything is actually paid to them in dollars.
“Both Israeli high-tech professionals and foreign residents have two options in this situation: either ask for a discount or wait until the dollar strengthens again. The problem for them is that when the dollar strengthens, apartment prices will probably also rise, and today many of them want to take advantage of the current market situation and the particular weakness in the homes sector.
“Fortunately, they are still in a buyer’s market, so their request falls on deaf ears. There are cases where the deal is fixed at a rate of four shekels to the dollar or the euro, and there are quite a few cases where a purchase is offered in the 20/80 format (20% equity now and 80% on occupancy), which has been very popular in the local market recently.”
Published by Globes, Israel business news – en.globes.co.il – on December 25, 2025.
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