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Israel: Regulation of Affordable Housing

(Aug. 17, 2011) On August 3, 2011, the Knesset (Israel's Parliament) passed the Planning and Construction Procedures for Speeding of Residential Construction (Temporary Provision) Law, 5771-2011. The stated purpose of the Law is to temporarily provide special arrangements for the approval of construction of residential apartments of various sizes. The Law is intended to increase the supply of residential apartments by, among other means, designating land for residential rental units. Plans regulated by the Law will be designed by specific public bodies and will usually include detailed proposals for the construction of at least 200 residential units, to be built mostly on state land.

The Law establishes in all regions “committees for national residence” that will be authorized to discuss and approve plans for residential construction. According to the Law, the implementation of the national residence plans will commence within two and a half years of their approval.

The Law will expire within 18 months of its publication and may be extended for a period not exceeding eight months by the Prime Minister and the Minister of the Interior, with the approval of the Knesset, based on a recommendation of the joint committee of the Knesset Internal Affairs and Environment and the Economics Affairs Committees.

According to the bill's explanatory notes, the Law is designed to address what is viewed as an economic and social threat created by the extreme rise in residential costs in Israel. This rise was caused, among other factors, by the sharp decline in residential construction and by the significant reduction in availability of housing for the public. The explanatory notes further suggested that the Law was designed to temporarily speed up the procedures associated with the approval of residential construction, which previously usually took over three years. (Planning and Construction Procedures for Speeding Residential Construction (Temporary Provision) Law, 5771-2011 & bill, the Knesset website (both last visited Aug. 16, 2011).)