Can Foreigners Buy Property in Israel? Yes – Here's How It Works (2026)
Updated: Oct 20
Yes. Foreign nationals and non-residents can legally buy property in Israel. There is no citizenship or residency requirement. What changes for a foreign buyer is the purchase tax, the financing rules and the paperwork. This guide explains each one, with current figures and the steps from first offer to registration.
Quick answer: what foreign buyers need to know
Ownership: Open to non-residents, in Jerusalem, Tel Aviv, Netanya, Efrat and elsewhere.
Purchase tax: 8% on the first ₪6,055,070 and 10% above, from the first shekel. Foreign buyers do not get the 0% starting band that Israeli resident first-time buyers receive.
Mortgage: Available to non-residents, generally up to 50% of the property value.
Closing costs: Budget roughly 10–14% on top of the price, mostly due at or soon after signing.
Lawyer: Essential. Use an independent Israeli real estate lawyer, not the seller's.
Tabu or ILA: what do you actually own?
About 93% of Israel's land is owned by the state or the Jewish National Fund. Only a small share is privately owned and registered at the Land Registry (Tabu).
Private land (Tabu): Ownership is recorded at the Land Registry.
State land (Israel Land Authority, ILA): You buy a long-term leasehold, commonly 49 or 98 years, rather than the land itself. This is normal in Israel and does not stop foreigners from buying.
Your lawyer checks whether a property is freehold, leasehold or company-registered, plus liens, municipal debts and building permits, before you sign anything.
Purchase tax for foreign buyers (Mas Rechisha)
Non-residents pay purchase tax at the same rates as Israeli residents buying an additional property:
Portion of the purchase price | Rate for non-residents |
Up to ₪6,055,070 | 8% |
Above ₪6,055,070 | 10% |
Examples
₪3,000,000 apartment: 8% × ₪3,000,000 = ₪240,000
₪7,000,000 apartment: 8% × ₪6,055,070 + 10% × ₪944,930 ≈ ₪578,900
Israeli residents buying their only home start with a 0% band, and new immigrants (Olim) qualify for reduced brackets on a sole residence, which is why status matters. Brackets are set by the Israel Tax Authority and have been frozen for now, but confirm the current table with your lawyer or the Tax Authority's purchase tax calculator before you sign.
Total cost of buying: what to budget
Cost | Typical amount |
Purchase tax | 8–10% (see above) |
Real estate agent | Commonly 2% + VAT (range 1–2%) |
Lawyer | Commonly 0.5–1% + VAT (more for complex deals) |
VAT | 18%, applied to professional fees, including for foreigners |
Land registry and sundries | Small, often around 0.2% + VAT |
Currency conversion | Around 0.5% if you convert through a forex provider |
Mortgage costs (if financing) | Bank file fee, appraisal, and a broker fee of about 1% of the loan + VAT if you use one |
Engineer's inspection | Recommended, often $800–$2,000 |
Illustration: on a ₪3,000,000 apartment, purchase tax (₪240,000), an agent at 2% + VAT (₪70,800) and a lawyer at 1% + VAT (₪35,400) already total about ₪346,200, or 11.5% of the price. Bank and other fees come on top. Unlike many countries, these costs are generally paid at or shortly after signing, not at closing.
Getting a mortgage as a foreigner
Yes, Israeli banks lend to non-residents, under stricter terms than for residents.
Loan-to-value: Israeli banks generally apply a maximum loan-to-value ratio of 50% to investment property purchases, including purchases by non-residents under the applicable rules. The actual amount offered to a foreign buyer depends on the bank's assessment, the property's valuation, the borrower's income and financial profile, and the applicable regulatory requirements. Plan to provide substantial equity and confirm your eligibility directly with an Israeli bank or mortgage adviser before signing.
Rates: Mortgage rates and repayment periods depend on the bank, the loan structure, the borrower's financial profile and market conditions. Any indicative rates or terms should be treated as estimates, not guaranteed offers. Request current written quotations from banks or a qualified mortgage adviser before committing to a purchase.
Structure: At least one third of the loan must be at a fixed rate.
Term: Often 20–25 years for non-residents, depending on the bank and your age.
Income test: Banks limit monthly repayments relative to your income and usually require life insurance.
Bank account: An Israeli account is required.
Timeline: Mortgage approval and the transfer of funds can take several weeks or longer for non-residents, depending on document verification, source-of-funds checks and the bank's requirements. Allow sufficient time and obtain preliminary approval before signing whenever possible.
Documents usually requested: valid passport, proof of income (payslips or accountant letter), credit report from your country, recent bank statements, and the purchase agreement.
Important: Israeli contracts rarely include a mortgage contingency clause. Get a bank pre-approval before you sign, and start the "source of funds" paperwork early, since banks apply strict anti-money-laundering checks.
Step by step: from offer to registration
Set your budget and get pre-approval. Include closing costs and, if needed, your mortgage pre-approval.
Hire an independent Israeli real estate lawyer. You can sign a power of attorney from abroad so most of the process can be handled remotely.
Choose a property with a licensed agent, and have an engineer inspect it.
Due diligence. Your lawyer checks title (Tabu or ILA), liens, permits and municipal debts.
Sign the contract. Israeli property purchase agreements are legally binding once signed. An initial payment is commonly due upon signing, according to the terms of the contract. Never sign a purchase agreement or memorandum of understanding before your independent Israeli real estate lawyer has reviewed it. Your lawyer will also advise on registering a cautionary note (He'arat Azhara), where applicable, to protect your contractual rights and help prevent a conflicting transaction.
Pay and report purchase tax. Your lawyer files the declaration and pays the tax.
Registration and handover. Your lawyer completes registration in your name and the keys are handed over.
Taxes after you buy
Arnona (municipal tax): The municipal tax payable on a property in Israel. Responsibility for payment generally depends on the property's occupancy status and the applicable arrangements between the owner and tenant. Confirm the local municipality's requirements and the terms of your lease..
Rental income: Rental income from residential property in Israel may be subject to Israeli income tax. Depending on the circumstances, eligible landlords may choose between different tax regimes, including a 10% tax on qualifying residential rental income, subject to the applicable conditions. The most suitable regime depends on factors such as the type and amount of rental income and the owner's circumstances. Foreign owners should also check whether they must file an Israeli tax return and declare the income in their country of residence. US citizens, for example, generally have US tax reporting obligations on worldwide income, subject to applicable exclusions, credits and other rules.
Capital gains (Mas Shevach): Tax may apply when you sell a property in Israel at a gain. The amount payable depends on the applicable tax rules, the acquisition and sale costs, eligible deductions, the property's circumstances and any available exemptions or preferential calculations. A 25% rate may apply in certain cases, but it should not be treated as a universal rate for every seller or transaction. Non-residents should not assume they qualify for the same exemptions as Israeli residents. Obtain individual advice from an Israeli tax professional before buying or selling.
Buying in Efrat and Gush Etzion
Many international buyers, including Americans, buy in Efrat and Gush Etzion. These communities are in Judea and Samaria, where land registration and, in some cases, tax treatment can differ from the rest of Israel. Before you commit:
Work with an agent and a lawyer who handle transactions in this area regularly.
Ask your lawyer in writing how purchase tax, rental income tax and capital gains apply to you for that specific address.
Confirm the property's land registration status and permits.
Noam Homes has extensive experience helping international buyers in Efrat, Jerusalem and other regions.
Common mistakes foreign buyers make
Underestimating closing costs, which are paid up front.
Signing before a lawyer has reviewed the document.
Assuming a mortgage will be approved after signing.
Overlooking leasehold status or unpermitted extensions, which can also reduce a bank's appraisal.
Ignoring tax obligations in the country where they live.
Starting the funds-transfer and bank paperwork too late.
FAQ
Do I need to live in Israel to buy property? No. There is no citizenship or residency requirement, and a lawyer with a power of attorney can handle most steps from abroad.
How much is the purchase tax for non-residents? 8% on the first ₪6,055,070 and 10% above that, from the first shekel. Confirm the current brackets before signing.
Can a foreigner get a mortgage in Israel, and how much will the bank finance? Yes. Banks generally finance up to 50% of the property value for non-residents. Approval usually takes 4–8 weeks.
How long does the buying process take? The legal steps often take a few weeks, but arranging financing and funds can take longer, so allow a couple of months.
Do I need an Israeli lawyer? Yes. Your lawyer verifies title, drafts and reviews the contract, handles the tax declaration and registers the property. Use a lawyer who is independent from the seller.
Can I buy from abroad, and how do I transfer the funds? Yes, with a power of attorney. Funds move through a bank or a regulated forex provider, and banks will ask for documents proving the source of your funds.
Can I rent out the property after buying? Yes. Rental income is taxable in Israel, and you may also owe tax at home.
Are there restrictions on buying in Efrat or the West Bank? Foreigners do buy there, but the legal and tax framework can differ from the rest of Israel. Work with a lawyer who has direct experience in the area.
Talk to Noam Homes
Ready to start? Contact Noam Homes for guidance on finding, financing and closing your home in Israel. We work with experienced Israeli real estate lawyers and mortgage advisors for international buyers.
This guide is general information, not legal or tax advice. Consult a qualified Israeli lawyer and tax adviser before you buy.
Sources consulted: Israel Tax Authority purchase tax calculator (gov.il), Nefesh B'Nefesh purchase tax guide, Global Property Guide, Israeli mortgage advisors and real estate professionals. Last verified October 2026.
