Gaza pact “mighty turning point” for Israeli real estate

Investors on the Tel Aviv Stock Exchange have responded positively to the agreement for a ceasefire in the Gaza Strip and the return of the Israeli hostages held by Hamas. The positive trend is led by the real estate sector. This afternoon, Shikun & Binui was up 10.5%, Israel Canada was up 10%, and Azorim was up 9%. The Tel Aviv Construction Index and the Tel Aviv Real Estate Index are among the sectoral indices with the largest rises, by about 7% and 5% respectively. Almost all the stocks on both lists have advanced.

It seems that investors believe that an end to the war could lead to an interest rate cut as early as the next decision by the Bank of Israel Monetary Committee in November. Lower interest rates help real estate companies both because they boost demand and because the companies themselves are generally leveraged and their financing costs fall.

Rotshtein Real Estate CEO Avishai Ben-Haim cited a further positive factor, namely the expected return of foreign workers to Israel, while Yossi Avrahami, chairperson and owner of the company that bears his name, mentioned the possibility of demand on the part of Jews overseas seeking to return to investing in Israel, and added the possibility of cheaper building materials.

“The agreement for the release of the hostages represents a watershed and restores the sense of certainty which the market has been seeking since the war broke out,” says Ben-Haim. “This is a formative moment with broad economic consequences that will lead to a series of significant steps: an interest rate cut, a return of investors to activity, and potential buyers coming off the fence after a long period of waiting. Together, these factors will give a strong push to the residential market and strengthen the public’s confidence in the system. At the same time, we expect a substantial flow of foreign workers, who have been afraid to come here, which will help to bring down construction costs and speed up construction times in the medium term. I see the market reviving substantially, and recovering stability within a short time.”

“The signing of the agreement and the hope of the hostages coming back within the next few days have created a positive atmosphere on a scale that the whole country has been waiting for,” says Avrahami. “If the agreement is implemented, it will be a mighty turning point that will give security, stability and renewed confidence, first of all in people’s hearts, and from there in the Israeli economy. The economy lives on confidence and movement, and as soon as the atmosphere changes, it’s felt in every sector, from high tech to the defense industries and in the real estate market.”

Published by Globes, Israel business news – en.globes.co.il – on October 9, 2025.

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