Seven years to foundations, why is bureaucracy the real enemy of housing?
Table of contents
Courtesy of the economy channel, Channel 14
The problem no one wants to talk about
In the middle of the heated discussion about “Buyer’s Price” on Channel 14, Dor Neuman shifted the conversation to a completely different place, to the problem few dare to say out loud: bureaucracy.
Seven years: and then more
Neuman, who leads real estate projects and development at the Ahuza company, spoke as a developer who knows what happens on the ground. “The most daunting thing that can happen to a developer today,” he said, “is to take a risk and start building a building, it will take him seven years. More.” In Israel, he said, it is not only about money or land, but about time. Time during which prices rise, needs grow, and the public keeps waiting.
A structural reform instead of a discount
His solution did not go through yet another discount program. “Instead of making a discounted apartment, we need to carry out structural reforms,” Neuman proposed. He spoke about increasing supply, about urban renewal, and about changing the incentive system so that developers will want to build, rather than run away from it.
Developers need certainty, not coercion
Neuman also referred to existing laws, such as the urban renewal laws, and argued that they have already been “over-legislated,” that is, there have been attempts to fix them, but not enough. The problem, in his view, is that people try to persuade developers to invest without giving them certainty. “You need to persuade the developer, instead of coercing him, to provide him with certainty about this, that he will earn at an affordable price.”
A drastic planning reform
He called for a “drastic” reform of the planning committees, not another cosmetic fix, but a systematic change. “Deal with this,” he said emphatically. “If you deal with this, we won’t need all sorts of cosmetics first.”
In other words: if the committee solves the planning and regulation problem, it will not need to apply band-aids like lotteries and discounted apartments.
Not center vs. periphery: a supply problem
At this point, Neuman crossed lines with part of the panel. When the talk turned to opening up areas in the Galilee or the periphery, he did not see the issue as center versus periphery, but as a supply problem. “The issue is not whether periphery or center,” he said. “The issue is why only ten thousand apartments, when there are hundreds of thousands of applicants?”
Without construction, no lottery will help
His message was clear: as long as a developer cannot build efficiently, as long as public money goes to the wrong places, and as long as planning committees block projects, no lottery will solve the housing crisis. Not a Mercedes in Kfar Saba, and not a slogan on television.
For in-depth reading on the subject, we also recommend consulting our guide on “Buyer’s Price”, cosmetics or an opportunity.
For in-depth reading on the subject, we also recommend consulting our guide on the interview on Nadlanist radio.
Further reading: urban renewal in Haifa.
