Buy an Apartment Now or Wait for 2027?

The Bank of Israel predicts two more rate cuts by mid-2027. The question that occupies anyone considering purchasing an apartment: wait to take advantage of a lower rate, or buy now before demand drives prices up? Here’s a numerical analysis, not just gut feeling.

What Happens If You Wait — The Optimistic Scenario

If the Bank of Israel's rate indeed drops to 3.0% as forecasted, the average mortgage rate may decrease by an additional 0.3%-0.5%. On a mortgage of 1,500,000 ₪ for 30 years, such a drop in rate (from 4.0% to 3.6%) saves about 341 ₪ in monthly payments — a real but not dramatic saving.

What Happens If You Wait — The Less Optimistic Scenario

A falling rate generally increases demand — more people meet the required repayment ratio, which could support rising apartment prices. If the apartment price rises by 3%-5% while you wait, it could "swallow" all the savings from the rate and even more. For an apartment worth 2,000,000 ₪, a 4% increase means an additional 80,000 ₪ to the price — much more than the savings in interest described above.

What Happens If You Buy Now

Those who buy now lock in the current apartment price and receive a relatively reasonable interest rate compared to historical levels (after three cuts in 2026). If rates drop further, one can always consider refinancing in the future — a tool that allows "catching" a lower rate even on a loan already taken, as detailed in the refinancing guide.

The Factor Most People Overlook: The Cost of Waiting Itself

Waiting not only exposes you to potential price increases — it also costs money: rent you continue to pay, missed opportunities, and sometimes even an increase in the required equity if prices rise faster than your savings.

When Does It Make Sense to Wait?

If your equity is still insufficient, and additional time will allow you to save the difference.
If you anticipate a significant change in your personal situation (new job, another child) that will affect your housing needs.
If the specific market you are interested in shows clear signs of slowdown, not just a general interest rate forecast.

Practical Conclusion

Perfect market timing is nearly impossible — rates decrease gradually, not in one jump, and the difference between buying today and buying in six months, in terms of interest alone, is usually marginal. Those who find a suitable apartment within a reasonable budget are generally better off not waiting for a "perfect" timing that may never come.

How to Factor the Decision Practically

Instead of trying to "guess" the market direction, it is advisable to approach the decision from a simpler question: does the apartment you found meet your needs at the current price and financing terms? If the answer is yes, waiting for "perfect" timing could cost more than it saves — both in the risk of price increases and in the opportunity cost of delaying the purchase.

What to Do If Your Equity Is Still Insufficient

If the reason for waiting is simply that your equity is still insufficient, that is a good reason to wait — you should not stretch your budget beyond your actual ability just to "catch" the current rate. In such a case, it is advisable to focus on the saving pace rather than guessing market timing.

Frequently Asked Questions

Is there a way to know for sure when rates will drop again?
No — forecasts are based on estimates from the Bank of Israel, but they depend on changing economic data and are not certain.

What happens if you buy now and rates drop faster than expected?
You can always consider refinancing in the future to benefit from the lower rate, even on an existing loan.

Do Ma'ale Adumim and Jerusalem behave the same way in terms of timing?
Not necessarily — a market with more limited inventory (like parts of Jerusalem) may respond faster to increasing demand than a market with broader supply.

Considering Buying an Apartment?

Check out properties for sale in Ma'ale Adumim and Jerusalem, and contact the Merkaz HaNekasim team for personal advice.