Real Estate – Afula

Why we like Afula?

  • The Israel Railroad is expanding its routes and will incorporate a new express train that will open for service in the very near future, allowing commuters to travel to Haifa in 17 minutes!
  • As housing prices have skyrocketed in the more central areas of the country, housing costs in Afula by comparison are considered a bargain
  • In anticipation of the arrival of the express train service, massive development is taking place in Afula  (Many new streets are being established and the growth has been planned in a methodical way, with new parks, playgrounds, shopping areas, etc.)
  • Afula’s growth has fueled an unprecedented building boom  (The current boom has kept apartment and housing prices in check as builders/contractors are building with the future in mind)

 

We believe that shortly after the train service begins operating in Afula, building lots will become scarce and demand will push prices significantly higher.  Buy a Piece of Israel management can help investors who are located abroad  negotiate a purchase at a fair price and then manage the apartment/house as a conservative rental unit.  With a conservative investment of a 50% deposit, the property can generate enough income to pay for all expenses while building equity.

 

Note: An increase in value of 50% will mean a 100% gain in equity and the prices in Afula would still be significantly lower than other off Center communities like Rosh Ha’Ayin (suburb of Petach Tikva straddling the Shomron) and  Kfar Yona (a suburb of Netanya only a couple of miles from the Shomron).  With such a positive upside and current prices being so much more reasonable than elsewhere, we feel that an investment in Afula is an appropriate conservative investment.

 

Afula Apartments 
1) The 4 room (3 bedroom) apartment examples in the center of Afula with balcony, parking, storage room, elevator,  2 bathrooms (1 with shower the other with bath/shower), at the very, very, low end start at 650,000 NIS and go for up to approximately 900,000 NIS.   There are some very attractive apartments in the mid 700s to low 800s.
The sizes average around 110 meters each, the ranges are 100 to 125 sq meters plus the balcony (mirpeset in Hebrew).
Rents on the very low end are about 2,500 NIS per month up to 3,200 NIS per month on the high end.  A fair average is 2,800 to 3,000.
2) The 5 room (4 bedroom) apartment examples in the center of Afula with balcony, parking, storage room, elevator, 2 full bathrooms (1 with shower and 1 with bath/shower), some with an additional 1/2 bath (powder room), start at about 850,000 NIS and go all the way up to 1,300,000 NIS.  There are some beautiful, large apartments available for 900,000 to 1,000,000 NIS.
Rents on the low end are about 3,000 NIS per month up to 3,900 NIS per month.  A fair average is 3,300 to 3,600.
The sizes not including balconies, range from 120 meters to 170 meters.  The average is between 140 and 160 meters.
Some Points of Our Rental Terms
We secure 3 months bank guarantee security (Arvut Bankai’it) as well as first month’s rent in advance.
We check their pay stubs, bank statements, and references.
In general we offer the prospective tenants a 1 year lease with a 1 year option (their option) provided they give us 90 days advance notice and have abided by the terms of the lease.
In addition:
- They give us 11 additional post dated rent checks, an open check made out to the city in case they fail to pay all of the municipal property taxes, open checks made out to the electric company, gas company, water company, and Vaad Bayit (building maintenance).
- The lease has photos of each room of the apartment with a list of what each room contains.  The tenant signs at the bottom of each page that he/she is accepting the apartment in clean, good condition, without any visible faults.
- During the course of the year, we send our maintenance people 2 x per year to check and perform  basic maintenance for plumbing, drainage, electric, air conditioning, etc.
VERY IMPORTANT: We are only interested in high quality tenants and owners.  Purchasers who do not care about the condition of the apartment or the quality of the tenant but only wish to “milk” the property will not be considered for our maintenance services after the purchase.  We are seeking stable tenants who will pay a bit more for a well maintained apartment and owners who appreciate stability while growing their equity in the investment by the income paying down the mortgage debt while anticipating price appreciation in the near to mid term.
Israeli Standards:
-The tenant pays for property taxes (Arnona), water, electric, gas, Vaad Bayit (building maintenance but not upgrades).
-In the case that the apartment is unoccupied, the owner is responsible for utilities, if any, property tax, Vaad Bayit.
-In the case that the majority of the building owners agree to building upgrades (which generally increase the overall value), each owner is responsible to pay his/her proportional share (usually in easy payments).
-In Israel the one who paints the apartment at the beginning does not paint it at the end, i.e. in most cases the tenant paints the apartment at the end of the lease.  In our model, we use high quality paint and materials and therefore will not trust the tenant to do nearly as good a job when he/she vacates.  With this in mind, the lease clearly states that the tenant agrees to pay a set sum at the end of the lease should he/she elect to leave at the end of the first year for painting the apartment.  The fee is reduced by 50% if the tenant stays a second year and is further reduced to 0 if they stay a 3rd year.
Our Maintenance Policy:
We strongly recommend having the apartment inspected by Chaim Cohen who is a licensed electrician, and is experienced in Plumbing (worked for the Water Authority for over 20 years), and construction.
The inspection includes checking the plumbing (showers, faucets, pipes within the apartment), ceiling, all electric to the apartment and within,  walls, doors, etc.  In the end, he writes up an estimate what he feels should be done to make the apartment in top condition.  We then take his estimate and add any other economical improvements to enhance the apartment that we think will help attract high end tenants.
-As a valued and hopefully long term customer, we do not charge you for the inspection and estimate.
-After coming to an agreement between the purchaser and management, we proceed to do all renovations that are agreed in the estimate and are responsible from start to finish.  We use exclusively Jewish Labor (Avoda Ivrit) and high quality materials throughout the apartment.  Depending on the apartment, these costs can range from $4,000 to $20,000.  In most cases, the cost averages between $4,000 and $8,000.
Maintenance Costs:
Depending on the apartment, we generally charge between 300 NIS and 700 NIS per month plus VAT.
Once we bring the apartment to top condition, we try very hard to keep it that way.
-Services include: Preparing and signing of lease, depositing of rent checks, annual statements, semi annual maintenance visits, organizing and supervising major repairs, if any, and maintaining good relations between all parties (landlord-tenant, tenant-neighbors).
-In the case that a major repair is required, we contact the owner and only proceed with his/her approval of price and of whom will do the required repair.
Purchase and Rental Points:
-Israeli law mandates that foreign purchases deposit at least 50% of the purchase price to obtain an Israeli mortgage.  We will gladly supply this service.
-In addition, if you require a knowledgeable attorney, we will provide one for you.  Generally, the cost is about 1.5% plus VAT.  We work as the go-between with the contract, power of attorney, the mortgage bank, etc, until the purchaser is fully registered as the new owner.
-In addition we charge the purchaser a 2% commission for the purchase of the apartment.  (We may also receive up to 2% from the seller if we are representing him/her as well).
-For maintenance customers, we waive the standard 1 month commission charged to owners (maintenance customers) for finding a tenant.
-The owner pays the attorney NIS 1,000 (shekels) for processing the lease.
-The standard 1 month commission paid by the tenant is also waived.
-We charge the tenant 500 NIS for processing fees.

 

 

For more details, go to http://www.buyapieceofisrael.com/contact-us/.