Tel Aviv Real Estate Market Transactions Report: Q1-Q2 2025

Comprehensive Edition

Executive Summary

The Tel Aviv real estate market has demonstrated remarkable resilience and growth in the first half of 2025, with transaction volumes rebounding significantly and prices trending upward across most neighborhoods. This comprehensive report analyzes recent transaction data, price trends, and market dynamics across Tel Aviv’s diverse neighborhoods, providing detailed insights for investors, buyers, and market analysts.

Transaction Volume Analysis

Overall Market Activity

The first half of 2025 has seen a significant rebound in transaction volume across Tel Aviv:

Transaction levels have increased by approximately 30% compared to the same period in 2024
The total number of residential transactions in Q1-Q2 2025 has reached nearly 6,000 units
New housing transactions have seen particularly strong growth, increasing by 71.5% year-over-year
Existing housing sales have increased by 21.7% compared to the same period last year
In April 2025 alone, there was an 80% jump in homes purchased (both new and second-hand) across Israel, totaling approximately 6,900 units

The resurgence in demand is evidenced by a substantial increase in mortgage activity, with NIS 7.8 billion in mortgages taken in May 2025, representing the highest level since August 2022.

Investor Activity

Investment purchases have become a substantial driver of market activity:

Investor purchases represented approximately 16% of all transactions in Q1-Q2 2025
In April 2025 alone, investors bought 1,175 homes, more than double the amount from April 2024
Non-resident purchases have increased by 83% year-over-year, though still below pre-pandemic levels
Foreign buyers, particularly from France, Australia, and the UK, have been especially active in premium neighborhoods like Neve Tzedek
The luxury market (properties priced at 10 million shekels or more) has seen a 39% jump in activity compared to the previous quarter

Detailed Neighborhood Analysis and Price Trends

Luxury Market Leaders

Neve Tzedek

Neve Tzedek continues to be one of Tel Aviv’s most prestigious and expensive neighborhoods, combining historic charm with modern luxury:

Price Range: NIS 70,000-85,000 per square meter (approximately $19,600-23,800 per square meter)
Recent Transactions:
- A 130 sqm apartment on Achva Street sold for NIS 7,790,000 ($2.18 million) in March 2025
- Properties with rooftop access commanding a premium of approximately 20% over similar units without this feature
Rental Market: Average monthly rent for a 3-bedroom apartment is approximately NIS 12,900 ($3,600)
Rental Yield: 3.13% for one-bedroom units and 3.29% for three-bedroom units
Buyer Profile: Predominately high-net-worth individuals, both Israeli and international, particularly French nationals

Neve Tzedek’s popularity is driven by its unique blend of historic architecture, cultural amenities like the Suzanne Dallal Center, and proximity to the beach. The neighborhood has maintained its status as Tel Aviv’s most fashionable area since its renaissance in the 1980s.

Rothschild Boulevard Area

The Rothschild Boulevard corridor remains Tel Aviv’s premier luxury address:

Price Range: NIS 80,000-150,000 per square meter ($22,400-42,000 per square meter)
Recent Developments:
- Luxury projects on Rothschild Boulevard have achieved sales at NIS 145,000-150,000 per square meter
- New ultra-luxury projects are targeting even higher price points
Transaction Volume: While prices remain high, transaction volume in luxury properties is somewhat lower than in previous years
Buyer Profile: Predominantly wealthy Israelis and international investors

The area continues to be characterized by its Bauhaus architecture, vibrant urban atmosphere, and concentration of financial institutions and high-tech companies.

Tel Aviv Port & Seafront

Properties with sea views continue to command significant premiums:

Price Range: NIS 70,000-120,000 per square meter ($19,600-33,600 per square meter)
Premium Features: Direct sea views add approximately 30-40% to property values
Recent Projects: Several high-profile developments have seen successful sales despite high prices
Buyer Profile: Mix of local wealthy buyers and international investors seeking vacation properties

Emerging and Gentrifying Neighborhoods

Florentin

This formerly industrial area has continued its gentrification trend, becoming a hub for young professionals and artists:

Price Range: NIS 40,000-55,000 per square meter ($11,200-15,400 per square meter)
Recent Development: The Florentin Quartet project has become an iconic landmark in the area
Current Projects: A new 200-unit project on Abarbanel Street (corner of Gvulot) is in the permit stage
Price Trends: Despite some cooling in the broader market in 2024, Florentin has maintained strong demand and price stability
Buyer Profile: Young professionals, artists, and first-time investors attracted to the area’s bohemian character

The neighborhood’s transformation from industrial buildings to modern living spaces has created a unique urban atmosphere that continues to attract buyers even when other areas experience slowdowns.

Jaffa

The ancient port area continues its transformation into a highly desirable location:

Price Range: NIS 35,000-60,000 per square meter ($9,800-16,800 per square meter), with significant variation depending on proximity to the old city and sea
Recent Transactions:
- A 75 sqm four-room apartment on Beit El Street in Tel Aviv-Jaffa sold for NIS 3,015,000 ($790,000) in April 2025, representing approximately NIS 40,200 per square meter
Notable Projects:
- The Scottish House, a historic building being converted into a boutique hotel
- Several preservation and development projects in historic structures
Buyer Profile: Mix of investors, young professionals, and international buyers attracted to the area’s character and relative value compared to central Tel Aviv

Jaffa’s unique blend of ancient architecture, multicultural atmosphere, and ongoing development continues to attract both residents and investors.

Sarona

This relatively new district has emerged as a significant commercial and residential hub:

Price Range: NIS 55,000-70,000 per square meter ($15,400-19,600 per square meter)
Recent Development: The Landmark project, approved for expansion by the Tel Aviv District Planning Committee
Commercial Activity: Home to international businesses, including major co-working spaces
Buyer Profile: Mix of professionals working in the area and investors attracted to its central location and modern amenities

Established Residential Neighborhoods

Ramat Aviv

This northern Tel Aviv neighborhood has seen significant activity, particularly around Tel Aviv University:

Price Range: NIS 45,000-55,000 per square meter ($12,600-15,400 per square meter)
Recent Transactions:
- A 96 sqm four-room apartment on Tagore Street sold for NIS 4,400,000 ($1.2 million) in May 2025
Rental Market: Average rent for a 4-room apartment is approximately NIS 9,670 ($2,700) per month
Buyer Profile: Families, university faculty, and investors targeting the student rental market
Notable Trend: Student housing demand is expected to rise by nearly 10% for the 2025-2026 academic year

The university’s presence continues to drive strong demand, with approximately 84.5% of student accommodations already leased for the upcoming Fall semester by June 2025.

HaTzafon HaChadash (The New North)

This area has emerged as a growth market with increasing popularity among families:

Price Range: NIS 40,000-50,000 per square meter ($11,200-14,000 per square meter)
Development Activity: Renovation of heritage buildings and new development projects
Buyer Profile: Primarily families seeking more space than available in central neighborhoods
Growth Drivers: Improved infrastructure and amenities, combined with relative value compared to central areas

Yad Eliyahu

This established neighborhood is seeing significant urban renewal projects:

Price Range: NIS 37,000-45,000 per square meter ($10,350-12,600 per square meter)
Recent Development: Multiple TAMA 38 and urban renewal projects in various stages
Transaction Volume: Strong revival in the last quarter of 2024, continuing into 2025
Buyer Profile: Mix of families and investors attracted by the area’s potential for appreciation

Market Dynamics and Supply Analysis

Supply and Inventory Situation

Tel Aviv’s housing supply situation presents a complex picture:

Despite the increased transaction volume, supply levels remain relatively high with approximately 66,000 new apartments available across Israel as of April 2025
The Tel Aviv district accounts for approximately 28% of the unsold inventory of apartments in Israel
New construction starts in Tel Aviv numbered approximately 5,300 units in the 12-month period from April 2024 to March 2025
Supply constraints are more pronounced in established central neighborhoods like Neve Tzedek and Rothschild Boulevard
Newer development areas and urban renewal projects provide most of the new inventory

Demand Factors

Several key factors are driving the robust demand in Tel Aviv’s real estate market:

Population density has reached 9,560 people per square kilometer in 2024, creating sustained housing demand
Tel Aviv’s population grew by 2.2% in 2024, reaching approximately 494,561 residents
Tel Aviv’s position as Israel’s leading economic and cultural hub continues to attract both domestic and international buyers
The city’s thriving tech sector has largely recovered from previous slowdowns, supporting high-end property demand
Improved infrastructure, particularly public transportation expansions, has enhanced connectivity and property values
Interest rate stabilization has eased financing costs, bringing buyers back to the market
Attractive developer financing terms, such as 20% down payment at signing with 80% due at delivery without interest, have stimulated new development sales

Rental Market Analysis

The rental sector has shown remarkable strength in 2025:

Average monthly rents have increased by 4.9% year-over-year, reaching NIS 7,000 ($1,960) across Tel Aviv
Rental demand has surged by 42% compared to the same period in 2024
Neighborhood variations in rental rates are significant:
- Neve Tzedek: NIS 12,900 ($3,600) for a 105 sqm three-bedroom apartment
- Ramat Aviv: NIS 9,670 ($2,700) for a 4-room apartment
- Jaffa: NIS 6,500-8,500 ($1,820-2,380) depending on location and amenities
Rental yields across Tel Aviv average 3-5%, with variations by neighborhood and property type

Property Type and Feature Analysis

Premium Property Features

Certain property features are commanding significant price premiums in the current market:

Rooftop Access: Adds approximately 20% to property values compared to similar units without this feature
Sea Views: Command premiums of 30-40% over comparable inland properties
High Ceilings: Particularly valued in historic neighborhoods, adding 10-15% to values
Parking Spaces: Add NIS 350,000-500,000 ($98,000-140,000) to property values in central areas
Elevator Buildings: Significant premium over walk-ups, especially in renovated historic buildings
Security Features: Secure rooms (Mamad) add value, especially in newer developments

New Development and Urban Renewal Trends

Several patterns are emerging in new developments and urban renewal projects:

TAMA 38 Projects: Continue to revitalize older buildings, with developers strengthening existing structures and adding floors in exchange for improving existing units
Pinui-Binui Schemes: Larger scale urban renewal where entire blocks are redeveloped
Mixed-Use Developments: Increasingly common, combining residential, commercial, and public spaces
Preservation Projects: Historic preservation combined with modern amenities command significant premiums
High-Rise Luxury Towers: Concentrated in areas like the Gat Rimon project, which includes two 40-floor towers with 380 apartments designed by architect Moshe Tzur

Regulatory and Tax Considerations

Recent changes to regulations and taxes are impacting the market:

Starting in 2025, an additional 2% surtax is being imposed on capital gains for high-income sellers (annual incomes over NIS 721,560 or $201,359)
Purchase tax brackets have been frozen for 2025, effectively increasing taxes for some buyers as brackets are not adjusted for inflation
A recent reform gives new immigrants significant tax breaks on their first apartment, potentially eliminating purchase taxes for acquisitions up to NIS 6 million ($1.7 million)
The end of the TAMA 38 program is approaching, with developers rushing to complete projects before the deadline

Market Outlook

Based on current trends, several predictions can be made for the remainder of 2025:

Price growth is expected to continue at a rate of approximately 0.9-1% per month, translating to an annual increase of 10-12%
Transaction volume is likely to remain strong, particularly in the luxury and mid-range segments
Investor activity is expected to increase further as confidence in the market grows
Rental prices will continue to rise, potentially at an accelerated rate due to housing affordability challenges
The gap between prices in premium neighborhoods and emerging areas may narrow as buyers seek value
New development activity will increase, particularly in areas with good transportation connections
Areas along the new light rail and planned metro routes will likely see the strongest appreciation

Conclusion

The Tel Aviv real estate market in the first half of 2025 demonstrates strong recovery and growth potential across most segments and neighborhoods. Transaction volumes have rebounded significantly, and price trends indicate renewed confidence from buyers and investors.

The market is characterized by significant price variations between neighborhoods, with luxury areas like Neve Tzedek and Rothschild Boulevard commanding prices that rival or exceed those in major global cities, while emerging areas offer relative value and growth potential.

For investors and buyers, the current market offers diverse opportunities across Tel Aviv’s neighborhoods, each with its own unique characteristics and potential returns. Understanding neighborhood-specific dynamics and property features that command premiums is essential for making informed investment decisions in this complex and dynamic market.

This report was compiled using data from multiple sources including the Israel Land Registry, Ministry of Finance, Central Bureau of Statistics, and real estate market analysts as of June 2025. While every effort has been made to ensure accuracy, real estate markets can change rapidly, and individual investment decisions should be made with professional advice.