September 22, 2014
This article follows up on themes discussed here and here by adding data about the association between location and price and income. The data source for apartment prices is a multi-year data set of the Israeli Ministry of Housing and Construction. The data set tracks the average apartment price over time in 74 localities with a total population of almost 6 million. This sample of localities includes all of the large cities plus an assortment of smaller towns. Arab majority towns are not represented.
Between the years 2008 and 2013 housing prices in Israel had increased significantly. The average apartment price rose from about 100 monthly salaries in 2008 to about 130 in 2013.
The location-associated data shows (Figure 1) that the price increase can be described well as a proportional increase of about 30% plus an offset of about ILS 200,000. Read the rest of this entry »