Elections 2026: What Housing Programs and the Stock Market Crash Mean for Buyers

On October 27, 2026, Israelis elected the 26th Knesset. Regarding housing—a central issue in the campaign—the result does not provide an immediate resolution: according to exit polls published by Israel Hayom, no bloc has secured the 61 seats required. While waiting for a government to be formed, the markets have reacted, and developers are waiting. This analysis is intended for buyers from abroad as well as Israelis already in Israel, without taking sides.

The Political Calendar

These dates say nothing about the length of negotiations. A government can be formed within a few weeks or take much longer.

The Stock Market Reacts to Real Estate

On October 28 at noon, according to Nadlan Center, the TA-Construction index had fallen by more than 7% and the TA-Real Estate index by more than 6%. The TA-35 was down 2.68% and the TA-125 about 3%. Several listed developers dropped between 8% and over 10%. TheMarker headlined that the worst-case scenario for investors had materialized, with the construction index down 8% and banks falling by 4%.

Nadlan Center explains this movement by the fear of a political deadlock that would delay the adoption of the budget and reforms. Highly indebted companies and projects dependent on lengthy urban planning procedures would be the most exposed. The dollar was trading around 3.09 to 3.10 ₪.

What This Means for Buyers

A stock market drop is not a drop in housing prices. But it does increase financing costs for listed developers and may push them to accelerate their sales. For buyers, this is a negotiation argument, provided they check the developer's solidity and the project's guarantees.

What the Opposition Proposes

Other lists propose a fund for urban renewal in peripheral areas, a fair rental law, or rent control.

What the Outgoing Coalition Did

In the absence of detailed programs, Nadlan Center analyzes the measures adopted during the legislative term.

Land, a Point of Weakness

The 63% drop in Israel Land Authority tenders year-on-year signals fewer housing starts in the coming years. The recent failure in Harish, detailed in our article on the tender with no winner, is one example.

Why Not Wait for the New Government

TheMarker noted on October 26 that housing prices have risen while support programs for households without homes have disappeared. Election promises often take years to materialize, and some never come to fruition. Basing your decisions on your own numbers remains safer.

Even when a measure is adopted, its impact on the ground depends on the entire chain: planning, land tenders, permits, workforce, financing. A program of 100,000 rental units over ten years, for example, requires available land and developers willing to commit—something the failure of Harish does not guarantee. Conversely, the freeze on purchase tax rates, already in effect, is impacting acquisition costs today. For buyers, the rule is simple: only count on what is voted and applicable at the signing date.

What Can Change Quickly

Some decisions depend on the annual budget or simple regulations: tax brackets, subsidies in peripheral areas, terms of target-price lotteries. A transitional government can delay these decisions. If your project depends on a specific benefit, have your lawyer verify that it will apply on your signing date.

For Israelis Already in Israel

Target-price programs and benefits for reservists may change. If you are eligible, follow announcements, but don't hesitate to compare with the open market.

For Buyers from Abroad

Political instability can affect the shekel. Spread your transfers according to the developer's payment schedule with our payment schedule simulator, and test several rate scenarios with the financing simulator.

Get Support

Calculate the full cost: 18% VAT included in the new property price, closing fees from 10 to 13%, purchase tax (Mas Rechisha) to be confirmed based on your profile, detailed in our Mas Rechisha guide. Three experts support you: lawyer · broker · architect. For more context, read our weekly market review.

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Sources

- Israel Hayom — Elections 2026: Exit Polls and Results (10/27/2026)
- Nadlan Center — Real Estate and Construction Indices on the Tel Aviv Stock Exchange Drop Amid Political Uncertainty (10/28/2026)
- TheMarker — "The Worst Scenario for Investors Has Come True": Construction Index Drops by 8% (10/28/2026)
- Nadlan Center — Rentals, Planning Cabinet, Land Prices: The Opposition's Housing Programs (10/26/2026)
- Nadlan Center — Periphery, Reservists, Construction: The Coalition's Housing Programs (10/27/2026)
- TheMarker — Housing Prices Increased, Government Plans for Homeless Households Have Disappeared (10/26/2026)
- Nadlan Center — Failed Tender in Harish: No Offers Accepted for 722 Housing Units (10/28/2026)