Why? How much? How? Move it!
“Why?” “How much?” and “How?” are the first questions that we should ask ourselves when we begin to search for an apartment in Tel Aviv. There are numerous considerations; therefore, a deep understanding of our needs will help us to find the right apartment. This article relates to the issues involved in purchasing an apartment, but is also relevant to rentals.
Purchasing an apartment for investment purposes is different than buying an apartment you intend to live in. First of all, one must ask how worthwhile the investment is, what the yields are over the short- and long-term, or to do a cost-benefit analysis. The process of buying an apartment you wish to live in, which is what I will focus on in this article, involves personal questions, dealing more with needs – the questions of “Why?” “How much?” and “How?”
Why?
The answer to this question will guide us in the right direction, thereby preventing us from chasing after the wrong apartment and thus avoiding bitter disappointment.
1. The need to move to a different area – proximity to the office / schools / centers of activity and more
2. The need for more space
3. The need for an elevator
4. The need for parking
5. The need for quieter surroundings
6. Uncomfortable surroundings, noise, annoying neighbors, and other disturbances
7. Upgrade in standard of living
How much?
What is our budget? Make a detailed list of resources that you have at your disposal:
· Loans
· Payment of an existing mortgage
· Taking an additional mortgage
· Future expected income – gifts, an inheritance, bonuses, a raise in salary
· Take into consideration an additional 10% in costs to cover various bank commissions, lawyer fees, real estate agent commissions, taxes (such as purchasing tax), plus other unexpected expenses
How?
What are the regions in Tel Aviv worth considering in your opinion? Make a list of at least three options and rank them in order of preference. Explain why you chose each option, and list the criteria for choosing each option. This will make it easier for you to choose among the different options.
It is very possible that during your search you will discover that moving from area ‘A’ to area ‘B’ leaves you with enough money for other “upgrades”, such as an elevator, parking, or the ability to buy on a better floor in a tall building. It may turn out that buying in a different area allows you to buy a larger apartment, or to install the kitchen you have always dreamed about.
If the neighborhoods are not familiar or are new to you, then visit the area, walk around the public areas from which it is possible to learn about the character of the neighborhood – stores, local groceries, synagogues (if it is of interest), kindergartens, cafes, etc. You can also inquire with friends and family who may live in the area.
Increasing one’s living space is one of the most widespread reasons for moving to a new apartment. Perhaps the family has expanded, you move in with your partner, you begin to work from home, or for whatever reason your current home is not big enough.
Define the minimum size you are looking for in an apartment – how many bedrooms you need. The home office should be defined separately – this can always be located in different spaces. In older Tel Aviv houses built in the Bauhaus style for example, there is usually space that is not reflected in the number of rooms, or the rooms themselves are particularly large and thus can be rearranged. As an alternative, set the minimum net area you need, rather than the number of rooms.
One of the important considerations in the architectural designs of an apartment is clarifying in just which spaces you live today. Usually, the addition of a child to a family demands the addition of more than one room. In this event, an increase of 15 – 20 square meters over the existing space is required.
Checking the market in Tel Aviv – does the current supply in the market meet the needs that you have defined for yourself, or is your budget appropriate for the market? In the event that you need a 4-5 room apartment with an elevator and one or two parking spaces, then you may have to look in one of the more northern neighborhoods of Tel Aviv (Bavli, Kochav Ha’tzafon, Lamed, Ramat Aviv, Azorei Chen), where there is a larger selection, and in accordance with the price.
Move it !!!
The information published in newspapers and Tel Aviv home listings does not list all the information you need. Get off your comfortable couch and go see apartments!
Again – “How?”
We have listed a number of articles that answer the main concerns that you have noted. Now you only need to learn the language of the market (what is “renovated”, “well-kept”, “maintained”, “needs renovations”, “magnificent”, “quiet”, etc.). This will help you in your “real” work and in dealing with real estate agencies throughout the process. Update yourself and learn the market prices, and the inventory of available apartments. At this point, you are acting as an “anthropologist” critiquing the situation, you are still not buying. Visit between five and ten apartments (if indeed the supply in the market allows this).
Tip – After visiting approximately five apartments or so in Tel Aviv, you may not remember exactly what you have seen in each apartment. All the sights and information become confusing and intertwine into a beautiful, colorful collage. At this stage it is essential to list exactly which apartments you saw, also the ones you chose NOT to see, each detail, marking date and prices, or attach the information that you downloaded from the Internet and add your comments. It is important to mark down which real estate agent showed you which apartment (the easiest way – attach the business card of the agent to the apartment page) in order to prevent duplication and to know where to return to if you want, and mainly where not to return to. And remember – don’t go anywhere without this list!
When you feel that you are ready, go to Tel Aviv real estate agents. It is recommended to go to agents whom you have heard about, who have been recommended to you, and who work in areas that you are focusing on. If you cannot find an agent through these means, turn to newspaper home listings and work only with those agents with whom you feel comfortable, who is credible, and who understand your needs. Let them know your profile as a guideline, if there are clear limits, then say so, but there is no need to enter into details, sometimes an apartment that is not very high up for example, may have the most exposure to greenery and a nice view. There are surprises. Therefore, you should focus on the three or four most important criteria for you: space / elevator / quiet / parking / neighborhood, etc.
What happens when the budget does not match the Tel Aviv market conditions?
Do I have the ability to increase the budget? Additional loans? A larger mortgage? Selling another asset?
If ‘No’
Does moving into area “B” or “C” on your list of preferred neighborhoods in Tel Aviv allow you to find an apartment that matches your demands? For example, a budget for a three room apartment in central Tel Aviv could allow for an upgrade including an elevator, extra space, or parking in the Bavli neighborhood. Sometimes a slight shifting of locations allows for more. Check the advantages and disadvantages in moving between the different neighborhood options that you listed, what is so essential about choosing one specific area?
If you absolutely must live in the chosen area, then what demand, which is not at the top of your list of criteria, can you compromise on — parking / elevator / a less quiet area / space / the condition of the apartment / the condition of the building / others? Sometimes the difference between an apartment that includes parking and one that does not is significant, and with that difference you can find some other arrangement that is easy and cheaper in a nearby parking lot for many years. Of course, an apartment located on a loud or quiet street also changes the price of an apartment. The price difference between an apartment on a quiet street and an apartment at the end of a road (number one or two) can reach thousands of dollars. This is similar to the price difference seen when moving closer or further away from the center of Tel Aviv.
On the main traffic arteries of Tel Aviv – Ibn Gvirol, Arlozorov, Jabotinsky, Dizingof, Ben-Yehuda, Pinkas, etc. – you can find particularly large apartments at attractive prices. These apartments may surprise you, especially the apartments that face the back. You may discover that such apartments overlook a large, green courtyard, making you forget you are in the center of city. The apartments on the front side of the building generally have balconies that block out the noise of the street, and their bedrooms are deeper into the building, with no windows overlooking the street. Here it is important to remember that “what you perceive from afar is not always what you see from up close”. Even so, you must take into consideration the difficulty you may have in selling the apartment when the time comes, since these apartments often take longer to sell.
Good Luck!
Written by Dorit Shanan
Dorit Shanan, – Central & North Tel aviv
dorit@tovado.com
TOVADO.Com
972+(0)3+5277712