He offered NIS 3.5 million on a 4.1 million apartment. The seller didn't even counter.
By Meir Rubenstein, Real Estate Advisor, Gabai Real Estate
Asking prices in Israel are often too high. Every buyer knows that. What they don't always know is how far under the asking price they can go before the seller stops taking them seriously.
Last week I had to call a buyer with news he didn't want to hear. He'd offered NIS 3.5 million on a Jerusalem apartment listed at NIS 4.1 million. I brought the offer to the listing agent, who took it to the sellers, and we got nothing back. No counter. The message was simply that the number was too far off to start a conversation.
He wasn't wrong to offer under asking. A lot of sellers in this city put a number on their apartment that the market won't pay. Some leave room to negotiate, some are going off what the neighbor got three years ago, and some just picked a number they'd like to get. Data on reported deals shows the average discount on secondhand apartments this year is about 4.8%, roughly double what it was in 2022, and fewer than one in ten apartments sell at the original asking price.
The problem was how far under he went. Sellers don't measure your offer against their asking price. They measure it against what they believe the apartment is worth, and in Jerusalem they usually know exactly what the apartment upstairs or the one across the street sold for. So does their agent.
Take an apartment listed at NIS 3.3 million where similar units have sold for around NIS 3.1 million. At NIS 2.9 or 3 million, you'll most likely get a counter. At NIS 2.5 or 2.6 million, I'd expect silence. The seller doesn't see a tough negotiator. They see someone who hasn't looked at the numbers.
Jerusalem also isn't moving like the rest of the country. Central Bureau of Statistics figures for July and August show prices down 1.8% nationally from a year earlier and 2.7% in the Central district, but only 0.2% in Jerusalem, which also led the country in secondhand sales over the summer. Developers with unsold stock on the edges of the city are giving discounts. A family selling a good apartment in Baka or Rechavia, especially one that has already bought its next place, generally isn't in a rush.
The question I hear more than any other is, "Can I get a good deal?" Prices are high, everyone feels it, and coming in low is a natural way to start. But in my experience, good deals rarely come from the opening number. They come from understanding the seller.
Why are they selling? A family that has already signed on its next apartment, heirs dividing an estate, or someone relocating abroad will often give up some of the price for certainty and speed. A strong, fast payment schedule with a large payment at signing can be worth more to that seller than another NIS 100,000 down the line. It also pays to know what the apartment really needs. An old kitchen, no safe room or additions that were never registered are real costs, and pointing to them gives the seller a reason to come down that has nothing to do with lowballing.
When I put an offer together, I want the comparables behind it: what sold in the building and on the surrounding streets, adjusted for floor, condition, parking, a balcony or a garden. I want the buyer's financing in order, either a bank's approval in principle or proof of funds. And I make sure the payment schedule and handover date are working for us, not just the price. An offer like that gets a call back from the other agent. A number with nothing behind it usually doesn't.
If you've been turned down, coming back NIS 50,000 higher won't change much. If you still want the apartment, come back with a real number and a reason for it, like a stronger payment schedule, a quicker closing or comps the other side can't argue with. And if the apartment is genuinely out of your budget, it's better to know now than after a month of back and forth.
An agent's job is to pass every offer on to the seller, no matter what the number is. That's not up for debate. But it's also our job to be straight with the buyer we're representing and tell them, before the offer goes out, if it's likely to be ignored. It's not always a fun call, but it beats losing an apartment you really wanted. If you're thinking about making an offer in Jerusalem, or you've just had one turned down, give me a call and we'll go through the numbers together.
Meir Rubenstein is a Real Estate Advisor at Gabai Real Estate, a boutique Anglo-Israeli agency serving Anglo and Israeli buyers across Jerusalem, Efrat, Ma'ale Adumim, Ra'anana, Tel Aviv, and communities throughout Israel. To have Meir look at the numbers before your offer goes out, or after one has been turned down, reach out at meir@gabairealestate.com or +972-58-797-6198.
