A buyer searching northern Israel from abroad may have a budget in dollars and a shortlist priced in shekels. Before converting currencies, settle another question: how much of that budget can actually go to the seller? Purchase tax, known as mas rechisha, can change which apartments are within reach even when the asking prices look identical.
A worked example in shekels
Consider an individual Israeli resident buying an entire residential apartment for ₪2 million in November 2026. If the buyer qualifies for the single-home brackets, the first ₪1,978,745 carries zero tax. Only the remaining ₪21,255 falls in the 3.5% bracket. Rounded to the nearest shekel, the purchase tax is ₪744. For a resident keeping an existing home and paying the ordinary additional-home rate, the same purchase falls entirely in the 8% bracket: ₪160,000. The seller receives exactly the same amount in both cases.
If ₪2 million is your all-in limit, an 8% purchase tax puts your theoretical offer ceiling at about ₪1.852 million even before legal fees, brokerage, financing costs or repairs. Set aside those other costs first, then divide the remaining budget by 1.08. That gives your agent a price range they can actually negotiate within.
Buying from abroad or planning a move
The first example assumes Israeli residency and eligibility for the single-home brackets. Owning no other Israeli apartment, holding an Israeli passport and planning to move are different facts. Tell your Israeli real estate lawyer where you live, what rights you and your spouse hold, whether you have inherited a share, and when a move or sale is expected. If you are replacing a home, ask which deadline applies and how much extra cash you would need if the sale misses it. A dated calculation with those assumptions is more useful than an undated screenshot of a tax figure.
What happens to the investment return?
Suppose the apartment earns ₪5,000 a month for twelve months. That is ₪60,000 a year, or 3% of the asking price. Divide the same rent by ₪2.16 million, including the additional-home purchase tax alone, and the gross yield falls to roughly 2.78%. Vacancy, repairs, management and tax on rental income still need their own lines. When modelling a future sale, ask separately about mas shevach, the tax on taxable appreciation. If you file tax returns abroad, have an adviser check the treatment there as well.
Use the calculator to compare scenarios
Enter the proposed price, choose the ownership scenario and read the breakdown by bracket. The quick estimate assumes a resident individual buying the whole apartment. Use the detailed calculation for a partial interest or special circumstances and save the PDF for your lawyer. Once you have a shekel offer ceiling and a reserve for costs, send me the neighbourhoods you are considering. We can shortlist homes on that basis before you book a viewing trip.
Calculate Israeli purchase tax · Apartment search
Rates for November 2026 · Single home · Additional home