Your Real Estate Expenses Guide For Buying A Home In Israel

<h1>Your Real Estate Expenses Guide For Buying A Home In Israel</h1>Author: <a title="Shlomi Ben Ishai" href="http://www.articlesbase.com/authors/shlomi-ben-ishai/5904.htm">Shlomi Ben Ishai</a> This guide will walk you through the various expenses associated with a real estate transaction in Israel. 
Whether you are looking to buy or sell a property in Israel, it will help you plan ahead and make sure you are on top of the game. It is built in a Q&A format for your convenience.
What Is the Purchase Tax?
Purchase tax is payable by the purchaser in a real estate transaction. Generally, the tax is between 3.5% and 5%, depending on the property value. A reduced tax of 0.5% is payable by an Israeli resident that is purchasing a residential apartment, if it is the only flat he owns. On real estate sales between close members of a family when no money changes hands, purchase tax is 1/3 of the normal rate of tax.
From the point of view of Israeli income tax, a wife with children under 18 are considered a single family unit, and therefore if the wife owns a property in her own name and the husband purchases a second property in his name, he will pay a higher tax rate as if he already owns a property.
What Is the Sales Tax?
Sales tax was introduced on 1.1.2000 and it applies to the seller. The tax is 2.5% of the value of the sale or 0.8% on the sale of a residential property by a building contractor. The sale of a property by a private individual is exempt from sales tax in many cases.
What is the commission of the real estate agents and brokers in Israel?
The commission in Israel is payable by each of the sides of the transaction (both seller and buyer). A good agent will save you more money than he costs, as he has a wealth of experience which will help you make the right decisions.
The customary brokerage commission payable is:
On the purchase or sale of property, 2% of the inclusive price of the property.
On leasing property for a period of one year or more, one month of rent.
Value Added Tax is added to any commission due (17%). 
Payment of the full commission is due on the signing of a binding agreement to purchase or lease a property.
What is the legal fee for the real estate lawyer?
When buying a first-hand property from a contractor, you will have to pay 1.5% plus VAT to the contractor's lawyer for legal fees.
In the case of second-hand purchase, you will pay between 0.5% and 1% plus VAT to the lawyer that will handle matters on your behalf.
What are the property inspection fees?
This is important especially when you are buying a used property. You should have the property inspected by a certified engineer or surveyor before signing the contract and make sure you have a written statement at hand. The average fee is approximately $400-$500 plus VAT but it may vary according to the size of the property.
What are the currency conversion rates?
When purchasing a property in Israel the payments are usually made in Israeli Shekels (NIS) and not in Dollars, Euros, etc. When converting money to Shekels, the bank usually charges a fee: between 0.1% and 0.5% of the amount that is being converted.
About the Author: Shlomi Ben Ishai is the owner and general manager of Nadlan-Plus, a top <A HREF="http://www.nadlan-plus.com">Jerusalem real estate Israel</A> firm, offering luxury <A HREF="http://www.nadlan-plus.com/jerusalem/apartment-in-jerusalem.htm">apartments in Jerusalem</A> and properties across Israel.Article Source: <a href="http://www.articlesbase.com/">ArticlesBase.com</a> - <a href="http://www.articlesbase.com/non-fiction-articles/your-real-estate-expenses-guide-for-buying-a-home-in-israel-32020.html" title="Your Real Estate Expenses Guide For Buying A Home In Israel">Your Real Estate Expenses Guide For Buying A Home In Israel</a>

This guide will walk you through the various expenses associated with a real estate transaction in Israel.

Whether you are looking to buy or sell a property in Israel, it will help you plan ahead and make sure you are on top of the game. It is built in a Q&A format for your convenience.

What Is the Purchase Tax?

Purchase tax is payable by the purchaser in a real estate transaction. Generally, the tax is between 3.5% and 5%, depending on the property value. A reduced tax of 0.5% is payable by an Israeli resident that is purchasing a residential apartment, if it is the only flat he owns. On real estate sales between close members of a family when no money changes hands, purchase tax is 1/3 of the normal rate of tax. From the point of view of Israeli income tax, a wife with children under 18 are considered a single family unit, and therefore if the wife owns a property in her own name and the husband purchases a second property in his name, he will pay a higher tax rate as if he already owns a property.

What Is the Sales Tax?

Sales tax was introduced on 1.1.2000 and it applies to the seller. The tax is 2.5% of the value of the sale or 0.8% on the sale of a residential property by a building contractor. The sale of a property by a private individual is exempt from sales tax in many cases.

What is the commission of the real estate agents and brokers in Israel?

The commission in Israel is payable by each of the sides of the transaction (both seller and buyer). A good agent will save you more money than he costs, as he has a wealth of experience which will help you make the right decisions. The customary brokerage commission payable is: On the purchase or sale of property, 2% of the inclusive price of the property. On leasing property for a period of one year or more, one month of rent. Value Added Tax is added to any commission due (17%). Payment of the full commission is due on the signing of a binding agreement to purchase or lease a property.

What is the legal fee for the real estate lawyer?

When buying a first-hand property from a contractor, you will have to pay 1.5% plus VAT to the contractor's lawyer for legal fees. In the case of second-hand purchase, you will pay between 0.5% and 1% plus VAT to the lawyer that will handle matters on your behalf.

What are the property inspection fees?

This is important especially when you are buying a used property. You should have the property inspected by a certified engineer or surveyor before signing the contract and make sure you have a written statement at hand. The average fee is approximately $400-$500 plus VAT but it may vary according to the size of the property.

What are the currency conversion rates?

When purchasing a property in Israel the payments are usually made in Israeli Shekels (NIS) and not in Dollars, Euros, etc. When converting money to Shekels, the bank usually charges a fee: between 0.1% and 0.5% of the amount that is being converted.

Shlomi Ben Ishai is the owner and general manager of Nadlan-Plus, a top Jerusalem real estate Israel firm, offering luxury apartments in Jerusalem and properties across Israel.

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