FAQ

A building permit is actually a request by the contractor to put up a building. He submits the plans to the local committee and the district committee, wherein he states the details of the building and so forth .... The relevant committees approve or reject the contractor’s application based on the master plan for the area.

On occasion, the contractor does not receive a building permit and therefore he is unable to commence building until the project meets the requirements.

Many contractors today sell apartments in a project at the planning stage.

The advantages to the contractor are that they obtain initial financing for the project, a guaranteed list of purchasers, and they can get the bank financing much more easily.

The advantages for the purchasers are that the get a more attractive price that could be as much as 20% less than the price of a finished apartment.

A mortgage is a loan given by a bank or a financial institution such as an insurance company, for the purpose of purchasing a residential building.

The property for which the mortgage is taken serves as a guarantee for the return of the loan, and in the event that the borrowers are unable to meet the repayment of the loan, the charge against the apartment will be used to collect the [unpaid] amount of the debt.

The mortgage is the loan that carries the lowest amount of interest on the market, with the longest repayment period.

Capital Gains Tax in real estate is a tax that is levied on the capital gain that is generated to the individual when selling an apartment, meaning the consideration he receives (or in exceptional cases, the consideration he is going to receive) against the price that he paid when purchasing the apartment.

Betterment levy is a municipal tax that is levied on the owner of the land or the long-term lessee by the local committee for planning and building in respect of the approval of the municipal building plan (MBP), which causes an increase in the value of his land.  The person upon whom this payment is levied is the one who was the owner of the land at the time of granting of the approval.

The size of the betterment levy is about half of the cost of the value of the land, where the calculation of the value is determined by a land assessor of the local committee.