Holiday home in Israel: everything you need to know

A tangible connection to Israel, a heritage investment and a base for your stays.

Why a holiday home in Israel?

For many living abroad, owning property in Israel goes beyond financial investment. It's a tangible link to the country, an anchor point for holidays, vacations and regular stays. With direct flights from New York (~12h), London (~5h) and Toronto (~11h), Israel is an increasingly accessible second-home destination.

Holiday home taxation

As a non-resident, you'll be subject to Mas Rechisha at the higher rate (8-10%). Arnona (municipal tax) remains due even when unoccupied, unless partial exemption is requested. For rental income, double-taxation treaties with the US, UK and Canada avoid double taxation. See our complete tax guide.

Best cities for a holiday home

Netanya: top coastal destination for overseas buyers. Seafront, established international community, reasonable prices.

Jerusalem: For stays related to holidays and spirituality. Strong short-term rental demand.

Eilat: Seaside resort with free zone (VAT exemption). High tourist yield.

Herzliya Pituah: The luxury segment. Villas and penthouses by the sea, marina, upscale restaurants.

Remote management: solutions

Managing a holiday home remotely requires rigorous organization. Management companies offer 'turnkey' services including: guest reception, cleaning, maintenance and bill payments. Expect 10-15% of rent. IsraelStart offers a dedicated management service for overseas owners. A real estate lawyer also supports you to secure your purchase.

Administrative obligations

The municipal property tax, known as Arnona, applies to every owner, whether resident or not. The amount varies by municipality, floor area and the property's classification: a flat in Tel Aviv is not taxed like a villa in Eilat. Bills usually arrive by post and can also be paid online on the municipality's website. Make sure the property is registered in your name to avoid reminders and late fees.

If you rent out your property, even for just a few weeks a year, the income must be declared. Israel notably offers a flat 10% tax on gross rental income — simple and well suited to modest rental income — though other regimes apply depending on the amounts involved. A local accountant experienced with non-resident files will secure your choice of regime and the filing calendar.

Comprehensive home insurance covers the dwelling, including during your extended absences: declare it as a second home and check exclusions linked to long periods of vacancy. For routine formalities — municipality, building management, utilities — a power of attorney given to a trusted person or a local manager lets them sign and pay on your behalf while you are away.

Getting the most out of your second home

Short-term rentals maximise income per night but demand active management: cleaning, key handovers, listings. Long-term lets provide steady income with little involvement, at the cost of reduced availability for your own stays. The right trade-off depends on how often you visit and how much time you are willing to devote to it, directly or through an intermediary.

A property left empty for months deteriorates quickly: damp, air conditioning, plumbing. Regular visits — by a neighbour, a caretaker or a maintenance company — allow airing, checking the installations and spotting leaks before they become expensive. Plan for outdoor maintenance too if the property has a balcony or garden, and consider a periodic professional inspection for complete peace of mind.

Connected cameras, monitored alarms, smart locks: home automation lets you watch over and secure your property from your phone, wherever you are. Real-time alerts and remote access for service providers (cleaning, maintenance) bring peace of mind and avoid unnecessary trips. Choose equipment compatible with local networks for a trouble-free installation.

The real cost of a holiday home left empty ten months a year

Buying is only the start of the budget. A 90 m² flat in [Netanya](/ville/netanya), shut up ten months a year, still costs money every year: Arnona first — in Tel Aviv, between ₪70 and ₪120 per m² per year depending on the neighbourhood, i.e. ₪6,300–10,800 for 90 m². Then the building fees (*vaad bayit*), ₪300–800 a month depending on the standard — a tower with a pool and concierge exceeds that ceiling.

The annual budget for a standard apartment: - Arnona: ₪4,000–11,000 depending on city and size - Vaad bayit: ₪3,600–9,600 - Home insurance: ₪1,200–3,000 - Water, electricity, internet, alarm: ~₪3,500 - Maintenance visits: ₪3,000–6,000 Total: ₪15,000–30,000 a year in fixed costs, before spending a single night there.

A partial Arnona exemption exists after six months of vacancy, but it must be applied for at the town hall and is never automatic. Don't build it into your budget: a property with controlled annual costs is one you keep happily.

Holiday home vs rental investment: the tax comparison

For a non-resident, the difference is not at purchase but in use: | | Personal use | Letting (even part-time) | |---|---|---| | Purchase tax | 8% from the first shekel, 10% above ₪6,055,070 | Same | | Arnona | Due every year, even when empty | Due every year | | Income | — | Taxable in Israel (10% flat rate on modest gross rents) | | Resale | 25% on the real gain, 15% withheld at source | Same |

Three or four trips a year and a flat that sleeps the rest of the time: holiday lets offset part of the costs, at the price of active management — see our [tax guide](/blog/fiscalite-immobiliere-israel). Planning a future move? Read [pied-à-terre and aliyah](/blog/pied-a-terre-israel-alyah): oleh status changes the game.

Frequently asked questions

Do I need to be an Israeli resident to buy a second home?

No. There are no restrictions on property purchases by foreigners: a non-resident can buy a flat or a house in Israel under the same ownership conditions as a resident. The only notable difference concerns bank financing, limited to around 50% of the property's value for non-residents. The rest of the process — purchase deed drafted by the lawyer, registration of the transfer at the Tabu (land registry) — is identical.

What happens for tax purposes if I rent out my property for part of the year?

Rental income is taxable in Israel, even for non-residents. The simplest regime is the flat 10% tax on gross rents, with no deduction of expenses, often advantageous for limited rental income. Depending on the amounts, other tax regimes may apply. Get support from a qualified tax adviser to choose the right regime and meet all of your filing obligations without stress.

How do I handle running costs while I am away?

Most charges — Arnona, building fees, water, electricity — can be paid by direct debit or online from abroad. For everything else, a power of attorney given to a trusted person or a contract with a local management company covers emergencies and administrative formalities. Set up these automatic arrangements right after purchase to avoid arrears and penalties.

How much does an empty holiday home cost each year?

For a standard 90 m², budget ₪15,000–30,000 a year: Arnona, building fees, insurance, standing charges and maintenance visits. The partial Arnona exemption after six months of vacancy must be applied for at the town hall — neither automatic nor guaranteed.

Can I short-let my holiday home, Airbnb-style?

Yes, it's very common — thousands of apartments in Tel Aviv. But income must be declared in Israel, and the tax authority monitors hosts who skip this. Check the building regulations and, from a distance, hand management to a local professional.

What tax applies on resale for a non-resident?

Mas Shevach: 25% on the real capital gain, without the main-residence exemption for residents. The buyer withholds 15% of the price at source, reconciled later. Keep renovation invoices: they reduce the taxable gain.

Sources: Israel Tax Authority, Israel Central Bureau of Statistics, local municipalities.