Is it possible to renovate tens of thousands of residential units in Israel, tens of thousands of residential units in almost aged, abandoned, and inaccommodating? Haifa Municipality is promoting the first physical policy document to reduce the number of abandoned buildings in the city. A survey conducted revealed that Haifa has around 700 abandoned buildings. This wastes land resources, damages urban fabrics, housing markets, and spends NIS 33 million annual tax losses on municipalities.
In November 2024, the National Economic Council conducted a study on unsuitable buildings, including residential buildings. An estimated 2.5 million square meters in Israel have been defined as unsuitable for use by most buildings in areas in demand.
Local tax exemptions encourage owners not to act
The National Economic Council recommended that, three years after the building was exempted, promote laws that required property owners to pay local taxes, first partially and then in full, according to the classification. All of this is expected to work for the owner to renovate and use them.
Haifa Municipality estimates that there are 700 abandoned buildings in the city, costing NIS 33 million per year to municipalities with losses in tax revenue. This follows information revealed in the future plans for the Haifa and North Conference in Haifa this week.
According to Vitali Dubov Dotan, head of Haifa Municipal’s abandoned building division, the reasons for the abandonment of the building are numerous, spanning large scale renovation costs, and conflicts between the heirs of the unauthorized area and the building. Added to this is a local tax exemption that encourages owners to not act.
Following the conclusions in the National Economic Council’s report, local governments have decided to promote the first policy document. This addresses reducing the number of abandoned buildings in the city. Municipalities will contact property owners and encourage them to use them, help promote plans and permits, and will connect with entities interested in purchasing or renting the property, and encourage them to provide loans for renovations.
Dubov-Dotan says that when you contact the property owner, you will receive a variety of responses. “When it comes to large buildings owned by companies and businesses, they already have the professional and business ability to make things go. When it comes to owners of private apartments, they are suspicious and ask what they can give in return. Of course, they were not given financial compensation, but were given specialized guidance.” But the core of the matter lies in his opinion in the fact that, in his opinion, there is currently no lever of actual pressure, as long as the owners of abandoned buildings are exempt from local taxes.
“Haifa is a pioneer in dealing with abandoned buildings and the first to establish a regulated local mechanism for the systematic treatment of this complex phenomenon, and could serve as a model for other cities in the coming years,” said Dankachinski, CEO of the Real Estate Centre, which hosts the Haifa and North Future Plan Conference.
Published by Globes, Israel Business News – En.globes.co.il – July 1, 2025.
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