Since the 40% down payment austerity measures went into effect, landlords around the country in spring saw their opportunity to ‘raise the rent’. I republish here the link to Haaretz http://www.haaretz.com/print-edition/news/israeli-website-seeks-to-name-and-shame-price-gouging-landlords-1.376473. I have personally seen rents go up to levels that it will take more than 50% of combined income for Israelis to afford the gap.
In real estate usually housing is forced into regulation by market supply and demand, austerity measures have created a false demand by pushing buyers to the sidelines and renters are taking it on the chin.
Government’s temptation worldwide is to put its hands too deeply into markets. In the case of Israel hands off would be the better approach, put the 40% down payment on the foreign investor and ease access to mortgage loans for locals to help bring the market back into balance. Also the Prime Minister should expedite plans to build more affordable housing units and release lands in outlying areas near big cities for development.