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WOOD MOTORS (313) 245-0619 or 372-2600 1251 Orchard lake Boat On Sugar lee) • West Bloomfield! 18101851,7170 'FAX (81018517176 istry survey, demand for housing public tenders as a method to cre- across the country has dropped ate demand for land and raise over the last few months, and prices. housing prices are gradually sta- But Mr. Ben-Eliezer said he is bilizing. "not sure housing prices will drop About 140,000 people have even if the ILA reduces prices." rights to government-backed The ILA uses the open tender mortgages of up to $23,000, but method, which means there is no this is insufficient to finance the maximum price limit. In some purchase of an apartment. In the cases, bids have been three times last three years, the government higher than government land ap- has not adjusted assistance de- praisers' valuations, reflecting spite the rise in prices. the strong competition prevail- Housing Minister Binyamin ing in the market. Ben-Eliezer says the govern- Now, however, the ILA is de- ment's assistance will be adjust- ciding whether to change its ten- ed "as soon as prices stabilize." der method, whereby there will Contractors and real estate be no minimum price. agents claim prices will only drop The state comptroller cites a if the Israel Lands Administra- few examples where land prices tion (ILA) releases more land. increased mainly because of ILA's In the past, the public blamed marketing method. In Beit contractors for the surge in hous- Shemesh, land per apartment in- ing prices, claiming they hoard creased to $17,000 in 1993 from land in order to push up home $5,000 in 1991. prices. However, this was refut- Similarly, in Ashkelon prices ed in the recent state comptrol- have increased to $17,000 from ler's report. $7,000. In the last report published in ILA is also blamed for the May, Comptroller Miriam Ben- surge in Beersheba's housing Porat found that ILA is the main prices. culprit in the government's fail- Deputy Housing Minister Eli ure to reduce the housing short- Ben-Menahem has criticized the age and stabilize housing prices. government's marketing of land "The rise in prices was due to in Beersheba, saying the ILA is limited marketing of land. The primarily interested in generat- authority had land earmarked ing funds for the government. for immediate construction but this was not marketed," the re- port said. The comptroller says that in 1994 the Housing Ministry pub- lished tenders to build 41,800 housing units, but signed con- tracts with the winning contrac- tors for only 26,800 units. Speaking at a Knesset debate Construction of 11,000 of them three weeks ago, Mr. Ben-Mena- was to have begun by December hem said, "To my sorrow, I have 1994, and of the rest, by mid- a gut feeling that the ILA has be- 1995. come the Treasury's bank. All of In practice, by the end of 1994, the government is to blame, in- the construction of only 5,560 had cluding the Housing Ministry. I begun. say this in my position as deputy Today, the ILA holds about 92 minister." percent of the country's land, The ILA published a lottery to amounting to 5.4 million acres. market 14 plots for construction The remaining 8 percent is pri- of Build Your Own Home neigh- vately owned. Most of the large borhoods in Beersheba's Ramot building projects in recent years district several months ago. More — for residential, industrial, com- than 800 people participated in mercial or tourism purposes — the tender, which generated very were constructed on ILA land. high demand and led to a rise in Last year, the ILA received prices. about $1.4 billion from contrac- The eighth-of-an-acre plots tors and entrepreneurs who pur- were sold for $90,000 - $100,000, chased land. The land component which is very high for a develop- in the price of an apartment can ment town. In reaction, the Beer- reach up to 50 percent, especial- sheba municipality decided to ly in the central region. prevent the ILA from marketing While the potential land re- plots in the city until prices are serves for residential building in significantly reduced, claiming the country's six districts (the that the ILA has created an ar- north, Haifa, the central region, tificial shortage of land in order Tel Aviv, Jerusalem and the to increase prices. The ILA de- south) total around 600,000 hous- nied the accusations saying it has ing units, the ILA refuses to flood plans to market more land by the the market. end of the year. The Association of Contractors More recently the ILA tried to and Builders has started a cam- influence the price of land in Ris- paign against ILA's method of hon Lezion by canceling a tender marketing of land. The contrac- for the marketing of just over an tors claim housing prices will re- acre, on the argument that the main high as long as ILA uses bids were too low. Several days Rise in prices is due to limited marketing of land.