In This Edition
- Welcome
- Featured Article – Renting Out Your Apartment
- Tip of the Month – The Dropping Dollar
- Legal Vocabulary – 'Sha'ar Yatzig' (Representative Exchange Rate)
- Subscription Information
- For Further Information
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Welcome to Israel Real Estate Law Insights
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Welcome to the latest issue of the Israel Real Estate Law Insights, published by
Nicole Levin Law Offices, experts in all aspects of real estate law in Israel.
You are receiving this newsletter because you signed up for it on our website or
because you filled out a form at a housing fair. Our newsletter focuses on the
legal aspects of buying, selling and renting property in Israel.
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Renting Out Your Apartment
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You've finally invested in real estate in Israel and now you're ready to earn some money by renting out the property. The following tips can help you protect your investment:
- The rental contract should be drafted by an attorney. It is easy to obtain examples of rental agreements but these standard agreements are often not comprehensive, and generally not specifically written with your own situation in mind.
- In addition to the rent, it is customary for the tenant to pay the municipal taxes, homeowner's association fees, running expenses of the property, and any expenses connected with the upkeep of the property. The tenant should also pay for insurance for third party liability, fire and theft. Insurance for the structure of the building is paid by the landlord.
- It is to your advantage to collect rent in advance. Contracts can be written to include a clause requiring that rent is paid every three months in advance, every six months, or even a full year in advance. This manner of collecting rent provides more of a protection for you.
- In order to protect your money you should require a security deposit from your tenant to be used in the event that the tenant does not fulfill all his obligations. You can also request a bank guarantee which will cover the cost of the expenses of the apartment during the term of the lease. Additionally, your tenant should obtain two guarantors...
Read the complete article in our articles section.
NOTE: Updated Purchase Tax (
Mas Rechisha) levels have been published which apply to transactions from 15 October 2007 until the next regular update on 15 January 2008. See our
Purchase Tax webpage. There are proposals for a significant change in
Mas Rechisha levels, but these are still in the process of being approved by the government.
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Tip of the Month
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Due to the falling rate of exchange of the dollar, Israeli sellers have begun to quote the prices of apartments that they are selling in shekels. Before, the prices of second hand real estate deals were linked to the rate of exchange of the dollar. This was good for anyone holding a strong currency. Now however, the prices are fixed in shekels and if your money is in dollars or another currency whose rate is falling against the shekel, you will have to add more money to make up for the lower sum you receive when you convert your foreign currency to shekels. One way to avoid this is to convert your foreign currency to shekels as soon as you know the price of the apartment in shekels (instead of waiting for the date of payment). You do, however, run the risk that if, before you have completed the payments for the property, the rate of your foreign currency goes up relative to the shekel, you will not earn anything due to the rise in the rate of exchange.
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Legal Vocabulary
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'Sha'ar Yatzig' –
This is the representative rate of exchange of the Israeli shekel to whatever currency you hold. There are three rates of exchange. The low rate is the rate by which bank buys your foreign currency. The high rate is the rate buy which you buy foreign currency from the banks. The representative rate of exchange is the middle rate. It is the official rate published by the Bank of Israel. To see the daily representative rate of exchange you can go into the web site of the Bank of Israel. Go to the links page of our website at to find the link.
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Subscription Information
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For Further Information
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Additional information can be found at:
http://www.levinlawoffices.co.il/free.shtml
Further interesting articles can be found at:
(NOTE: New articles available!)
http://www.levinlawoffices.co.il/articles.shtml
If you have any further queries please feel free to make use of the Contacts page on our website:
http://www.levinlawoffices.co.il/contact.shtml
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