JERUSALEM -- Take in the $3 million views of the Jerusalem skyline from the fifth floor of the new, luxury Talbiye Residence: charming red-tiled roofs, historic limestone buildings, graceful cedars. On a distant hill to the south is Bethlehem.
Just beyond a cluster of greenery barely three blocks away is the site of the city's last suicide bus bombing. But the proximity has not deterred buyers.
Foreigners are snapping up luxury apartments in Jerusalem, many of which boast spectacular views of the Old City.
(Lefteris Pitarakis -- AP)
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"One family bought the entire floor," all 4,949 square feet of it, boasted Ishai Levy, project manager for Talbiye Residence, one of Jerusalem's most upscale new apartment buildings. "The buyer is an American lawyer from New York with a wife and five kids. Religious. Modern Orthodox."
Encouraged by religion, wealth and a slowdown of violence inside Israel, Jews from abroad are snapping up luxury Israeli real estate, driving prices to levels rivaling those of the 1990s, during periods of relative peace.
Whether it's garden apartments near the ancient walls of Jerusalem's Old City or high-rises looming above Tel Aviv's Mediterranean shore, affluent Jews in the United States, Europe and South America are latching on to posh properties here. The buyers want to acquire spots for vacation trips during religious holidays, buy property out of solidarity with Israel or just acquire a trophy house in an exotic location, according to real estate agents and builders.
While most of the Israeli economy is hobbled by the pressures of the Israeli-Palestinian conflict, foreign property purchases leapt to $464 million in 2003 -- nearly triple the amount for the previous year and more than double the amount for the pre-conflict year of 1999, according to the Bank of Israel, the country's central bank. Real estate brokers say residential property sales are driving the numbers; commercial investors continue to shun the country.
Many of the properties are within sight of recent suicide bombings or just a few miles from the war zone in the West Bank and Gaza Strip, where Israeli attack helicopters and tanks battle Palestinian fighters. Even so, in the last year the pace of violence inside Israel has subsided enough to lure well-heeled Jews from around the word.
"There was a feeling that things were bad in Israel, that people didn't come here because it wasn't safe," said Corrinne Davar, who has been in the real estate business in Jerusalem for 22 years. But she said that after the Sept. 11, 2001, attacks in the United States, "people are saying, '. . . It's unsafe everywhere -- why not buy in Israel?' "
"Some people said we were crazy," confessed Marvin Schick, 70, a retired New York professor who recently purchased a three-bedroom apartment with no view in a prestigious neighborhood for "more than $500,000." Schick, a Modern Orthodox Jew, described his primary motivation for buying property in Jerusalem: "To reinforce the notion of identifying with Israel."
Like most of the foreigners purchasing high-end properties, Schick has no plans to move to Israel. He'll visit on Jewish holidays and lend the apartment to family members and friends touring Israel, he said.
"They come for Sukkot and Passover, meet all their friends, then go back to the good life in the States," Isaac Levy, manager of Ambassador Real Estate, said of his foreign clientele. "Most are religious, Modern Orthodox and they're coming and buying for one reason -- emotion."
While religious motivations run high, property consultant Alan Deco, who deals exclusively with Orthodox clients, said some of his wealthiest buyers also want a new and different status symbol.
"It's social and spiritual," said Deco, 54. "The rich holiday together. They cluster. They want to be walking distance from friends and the synagogue. They're willing to spend $975,000 on a one-bedroom to show they have a trophy flat."
He stood on the balcony of one such apartment, which he recently sold, in David's Residence, a group of 36 limestone-faced apartment houses overlooking the ancient stone walls of the Old City of Jerusalem. A separate set of 120 apartments, David's Village, stretches nearly to the base of the wall. The apartments are some of the fanciest housing in one of the best locations in the city. Almost all are owned by foreigners, he said. And they are empty most of the year.
