The IsraTransfer Report: September 2020

In this Issue:

  • High Holiday Office Hours + Trading Schedule

  • From the IsraTransfer Trading Desk

  • A Summer Surprise: New Hope for Israel and the UAE

  • Get out of Town! Urban Centers Lose their Appeal.

High Holiday Office Hours + Trading Schedule


From the IsraTransfer Trading Desk




For the first three weeks of August, the shekel exchange rates were as calm as we have ever seen them. The rates were low, and nothing seemed to move them, not even the breaking Israel-UAE peace agreement. If these were ordinary times, this would have been a significant positive for the shekel, and we would have seen it rise. But we live in an unusual time, and events that influence currency fluctuations don't always have the effect we would expect.  The US dollar/ shekel rate graph was a straight line, with the rate not moving much from 3.4000. This level is a psychological one, and once the rate falls below it, further movement can be triggered. As soon as the rate dipped slightly, it quickly dropped down to a 12 year low of 3.35. While it has recovered somewhat from this low, it has not got itself back above the 3.4000 yet, despite some useful employment data coming out at the end of last week. In the UK, we have seen sterling anywhere between 4.45 and 4.52 over the last month. This rise, which is an improvement compared to July, is mainly due to the sterling and other major currencies strengthening against the US dollar. We expect the rest of 2020 to continue to give us volatility in the rates. Many significant events are going on in Israel and around the world before the year ends. The holidays in Israel, which always cause a little volatility, will be followed by the US elections in November, Brexit negotiations, and maybe even another election in Israel!


A Summer Surprise 


The world was shocked by a mid-August announcement that the United Arab Emirates and Israel will begin normalizing relations. With the looming threat of Iran and the current global economic crisis, the treaty offers a glimmer of hope for greater peace and financial growth for both countries.


The UAE is the second most robust economy in the Middle East, with a $400 billion domestic product a year. The Ministry of Economics predicted that Israel could gain hundreds of millions in trade and investments due to the recent deal. Given Israel's reliance on exports, the agreement could prove significant for the small country which can't rely on local markets alone. According to Shira Greenberg, the chief economist at the Israeli Ministry of Finance, the normalization of ties between the countries has a "vast potential for exports." It will likely open up opportunities between Israel and other Gulf countries. Areas of mutual economic interest include oil sales, cybersecurity, travel, tourism, technology exports, desalination plants, and smart farming.  

The two countries were quick to get to work. Since tackling Covid-19 is a main priority, two Israeli companies already signed a deal with an Emirati firm towards that end. In the last few weeks, boycotts were lifted, flights began, telephone lines opened, and an MoU (memorandum of understanding) on banking and finance was signed. It has been a surprising upturn amidst a cloud of pandemic related crisis. 


Get out of Town! 

Urban Centers are Losing their Appeal.

Coronavirus caused urban centers to lose their former appeal, and the real estate market sees a boom in a preference for "country" life. 


Many people prefer the convenience of city life and are willing to pay higher prices for it. But with the current pandemic, urban life lost its appeal to many who find it limiting in the event of a lockdown. Larger homes with extra rooms for office space, outdoor areas, and porches have become more attractive in light of the new reality created by Covid-19. Crowded cities with small apartments and tight living quarters unsurprisingly seem a little less desirable.


With the current work landscape changing, people aren't as tied to living near an urban center. Working from home is an acceptable option that enables one to choose to live near the sea, dessert views, or anywhere you fancy. In a recent webinar with local real estate experts, we explained the change in buyer preferences and how larger homes with an office, extra bedroom, and outdoor space might be preferable to a small apartment in a crowded city near an industrial center. 


In light of this change, an article on the subject reviewed several areas in Israel away from urban centers. Although waterfront properties can often be pricey, kibbutzim provide an affordable way to live near a river. Many kibbutzim have been privatized, and some have "extension neighborhoods" where houses can be purchased for NIS 1.66 million - NIS 3.25 million. Seafront properties along the Mediterranean are available in Ashkelon, Ashdod, Tzukei Yam, Herzliya Pituach and can run between NIS 3.45 million up to nearly NIS 20 million. 


The dessert has affordable housing and breathtaking views. Mitzpeh Rimon has homes for under NIS 1 million right near the Ramon Crater. Klil, a settlement in the Galili, is known for its "isolated houses, located at a distance from one other, scattered among vast olive groves and woodlands" with sizeable homes ranging from NIS 1 million to NIS 3.5 million. Many buyers are also considering settlements near the Dead Sea, such as Neve Zohar and Kayla. 


Green Light Ahead

New Flight Regulations May be On the Way


While entry to Israel is still only permitted for citizens, residents, and passengers with special approval, there is hope on the horizon. In collaboration with Rambam Medical Center, Omega Institute for Modern Learning received authorization to operate a Covid-19 testing station at Ben Gurion airport. The station is scheduled to be running in a month and a half and will charge passengers only NIS 44 per test! This will enable quarantine for travelers to be reduced from 2 weeks to a mere 14 hours. An expedited test will also be available for NIS 135 and require 4-hours of isolation. 


The number of “green” countries, or countries where Israelis can travel back from without requiring isolation, expanded to include Australia, Uruguay, Ireland, Taiwan, Norway, Singapore, Portugal, Thailand. The newly accessible United Arab Emirates also made its way onto the green list. Israeli travelers coming from Austria, Italy, Estonia, Bulgaria, the United Kingdom, Georgia, Germany, Denmark, Hong Kong, Hungary, Greece, Jordan, Latvia, Lithuania, New Zealand, Slovenia, Finland, Canada, Cyprus, Croatia, and Rwanda were already exempt from the 2-week quarantine upon return. 


In Case You Missed It...

Ward off Covid-19...in Style! 

An Israeli designer creates the world's most expensive face mask. 


Are you bored with your standard facemask? How about one made from 18-karat gold encrusted with 3,600 natural diamonds? While it may sound crazy, one wealthy customer of Yvel Jewelers commissioned the company to produce the masterpiece for him. The mask, which weighs 270 grams, comes with a heftier price tag of $1.5 million, was an initiative to create work for the company's teams in Israel and the USA during current difficult times. 


Read more about the world's most expensive mask. 


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