An oleh buying his first home in Israel faces a process that looks familiar from the country he came from: find a property, agree a price, sign, pay, take the keys. In practice almost every stage is built differently here. Who holds the money on the way, what protects the buyer between signature and registration, and which tax obligations fall on the purchaser rather than the seller are all answered by a different set of rules.

This page is about the purchase process itself: the checks that precede signature, the structure of the agreement, the protections the buyer should receive, and the steps that must be taken after signature. It is written for someone buying in Israel for the first time, including a buyer who is still abroad and wants the transaction carried out remotely.

What is different here

Ownership of registered property is determined by registration in the Land Registry, not by delivery of a deed of title. Until registration is complete, the buyer's position rests on the protections registered in his favour.

There is no established title insurance market in Israel. No policy will compensate after the event. The protection is the legal investigation carried out by the buyer's own advocate before signature.

There is no external escrow company. The advocates for the two sides draft the agreement, release payments against protections, and carry out the registration. That makes the choice of the buyer's advocate a structural decision rather than an administrative one.

The tax reliefs for an oleh sit on separate pages

An oleh has substantial reliefs in purchase tax, alongside income tax reliefs and credit points. The subject rests on regulations and on periods that have changed recently, so it is kept in two separate articles rather than summarised loosely here. The purchase tax brackets on the oleh track and their conditions are set out in the article on the purchase tax relief for an oleh. The income tax exemption, the window of entitlement and the form required are set out in the article on the exemption for olim and veteran returning residents. Both are worth reading before signature, because the timing of the aliyah and the timing of the purchase bear on each other.

Stage one: the preliminary legal investigation

Most of the risk in the transaction is settled here, and the investigation is done before any document is signed.

Stage two: the memorandum, and why not to sign one

Under section 8 of the Land Law, 5729-1969, an undertaking to carry out a transaction in land requires a document in writing. A short page signed in someone's living room, identifying the parties, the property and the price, may amount to a binding contract before any investigation has been done. The safe rule is simple: sign nothing before the buyer's own advocate has seen it.

Stage three: the sale agreement

The agreement settles what is not self-evident: an exact description of what is sold, the price and the payment schedule, the delivery date and the condition of the property at that date, the seller's responsibility for discharging encumbrances and debts, the allocation of the tax burden, agreed damages on breach, and the conditions for registration. In a transaction for an oleh two further subjects arise: fitting the payment schedule to the dates on which funds can be transferred from abroad, and dealing with a delay in mortgage approval.

Stage four: the caution note, the principal protection

Months usually pass between signature and completion of registration, and sometimes years. During that period the buyer has already paid, but the property is still registered in the seller's name. Section 126 of the Land Law, 5729-1969 allows a note to be entered in the register recording that the holder of the right has undertaken to deal with it. Section 127 supplies the consequence: while the note stands, no conflicting transaction can be registered against that property. A double sale to a third party is blocked, and the buyer is given a preferred position against creditors of the seller who come after the note.

That last qualification matters. The note takes effect from the moment it is registered, and it does nothing against a mortgage, note or attachment already on the title, so the search and the note belong on the same day. What it protects is the right to be registered, not the return of money already paid.

The note is registered immediately after signature, not "in due course". The first substantial payment should be conditional on the note having been registered and verified on a fresh extract. Where the property is not registered in the Land Registry a parallel mechanism is required, and it does not necessarily give the same protection.

Stage five: payments, delivery and registration

Each payment is released against a protection the buyer has received. The first substantial payment against the caution note, interim payments against discharge of encumbrances and delivery of tax certificates, and the final payment close to delivery. Delivery is recorded in a protocol: the condition of the property, meter readings, keys and defects. Registration follows receipt of the real estate taxation certificates, the municipality's confirmation that no debts remain, and a betterment levy certificate where one is required.

Between signature and registration the funds do not sit with the seller. Israel has no external escrow companies of the kind common elsewhere, and the function is performed through a trust account operated by the advocates for the parties. Sums earmarked for discharging an encumbrance are paid directly to the lender against a redemption letter, so that at no point does either side hold both the money and the property.

The obligations that fall on the buyer

Declaration within 30 days

Both parties must file a declaration with the Director of Real Estate Taxation within 30 days of the date of the transaction, under section 73 of the Real Estate Taxation (Appreciation and Purchase) Law, 5723-1963. The buyer's obligation is separate from the seller's and applies even where no tax is in fact due. Delay can attract penalties and hold up registration. The obligation to declare is separate from the obligation to pay: purchase tax, which is the buyer's own tax, is paid within 60 days of the date of the transaction.

The advance on the seller's tax

Under section 15 of the same Law the buyer transfers part of the consideration directly to the Tax Authority on account of the seller's appreciation tax: 7.5% of the consideration where the seller acquired the property on or after 7 November 2001, and 15% where he acquired it before that date. The rates are current as at August 2026. The sum is deducted from the consideration and is not an addition to the price.

The obligation arises once more than 40% of the consideration has been paid to the seller, and more than 80% where the seller is a developer. It does not apply on the sale of a qualifying residential apartment for which an exemption from appreciation tax has been claimed, which is the ordinary case on a second-hand apartment. Where it does apply, a buyer who transfers the entire consideration to the seller may find afterwards that he owes the Tax Authority money that has already left his hands.

Properties not registered in the Land Registry

The consequences are longer timetables, protections in a different form, and a more complex investigation. None of that makes a property unsuitable, but it must be known in advance and reflected in the agreement.

Buying from a developer

Protection of the buyer's money in a new apartment is governed by the Sale (Apartments) (Assurance of Investments of Purchasers of Apartments) Law, 5735-1974. Section 2 prohibits the seller from receiving more than 7% of the price of the apartment without having provided a security. The Law lists five: a bank guarantee, an insurance policy, a first mortgage over the apartment or over a proportionate share of the land, registration of a caution note, and transfer of ownership or another right into the buyer's name. Separately, in a project with bank financing the funds are paid by voucher into a closed accompaniment account.

In parallel, the Sale (Apartments) Law, 5733-1973 requires a specification to be attached, setting out the contents of the apartment and the standard of finish. The specification is the basis on which any later claim about the apartment as delivered is measured. Three documents are read together: the agreement, the specification and the wording of the security. A security in an amount lower than what has actually been paid creates a gap, and the gap is closed immediately rather than at the end of the project.

Buying remotely, and the power of attorney

Section 20(a) of the Notaries Law, 5736-1976 provides that a general power of attorney, and a power of attorney to carry out a transaction in land requiring registration, has no effect unless drawn up by a notary. The closing words of the section preserve section 91 of the Bar Association Law, 5721-1961, so a power of attorney given by a client to his own advocate and verified by that advocate under section 91 is valid without a notary.

For a transaction carried out from abroad the notarial route is the practical one, and section 20(b) is what makes it work: it disapplies the requirement to a power of attorney given outside Israel in accordance with the law of the place where it was given. A notarial verification requires the signatory to attend in person before the notary, to be identified, and to understand the content of the document. The notarial act itself cannot be performed on an electronic signing platform, on a scan of a signed document, or by video, and a power of attorney authenticated that way is not accepted for registration.

Where the power of attorney is signed outside Israel, further authentication is needed. Signed before a local notary in a state party to the Hague Convention of 1961 abolishing the requirement of legalisation for foreign public documents, an apostille from the competent authority there is required; in a state that is not a party, consular legalisation is required. A further possibility is signature before an Israeli consul, which needs nothing beyond itself.

A separate document is verified before an advocate under section 91 of the Bar Association Law for the purposes of the registration itself. The two documents do different work and do not substitute for each other. Prepare early: an appointment with a notary, an apostille and posting the original can take weeks, and the payment schedule will not wait.

A mortgage for an oleh

An oleh can obtain bank finance, but the process differs. The bank examines a credit history that was not accumulated in Israel, income originating abroad and sometimes in foreign currency, and documents issued in another country that require translation and authentication. A file for a self-employed applicant, or for someone working remotely for a foreign employer, is examined more closely. Approval in principle is needed before the agreement is signed, and the currency conversion and the transfer dates have to fit into the payment schedule.

The costs around the price

There is no single percentage that describes the total. It moves with the value, the status and the type of transaction, and it is therefore calculated individually in advance.

The amounts and rates are current as at the date of update and change from time to time.

Where to go next

Last updated: 31 August 2026

The content of this page is general information only. It does not constitute legal or tax advice and should not be relied upon in making decisions. The law, the amounts and the brackets change from time to time. Specific circumstances require individual advice.