Living on a prayer: Israel’s ultra-Orthodox face the housing crisis

For several months, the Israel Lands Administration website has listed a tender for new bids to purchase and develop land for thousands of apartment in western Kiryat Gat, in the south of the country. The tender has been postponed repeatedly. The neighborhood was originally planned for the ultra-Orthodox community, as can be seen in the number of floors planned per building and the “sukkah balconies” – balconies positioned in a way that enables kosher sukkas to be built on them during the holiday of Sukkot, and which are now a staple of construction for the religious public.

Under the previous government, Housing Minister Zeev Elkin and Interior Minister Ayelet Shaked decided to alter the plan and make the housing suitable for the general public. Since then, the request for bids was put off again and again, and the decision over the fate of the neighborhood is now in the hands of the new government. At a February conference sponsored by the ultra-Orthodox newspaper Yated Ne’eman, Housing Ministry Director General Yehuda Morganstein was asked if the request for bids was postponed because more changes are expected to make the neighborhood suitable for the Haredi population. Morganstein’s reply was a firm yes.

The housing crunch affecting the public as a whole is being felt even more acutely by the ultra-Orthodox community, whose options are limited due to things like the height of buildings and the fact that large segments of this community don’t use elevators on Shabbat. The lack of public buildings and schools suited to this community also means they would feel uncomfortable moving to many cities and towns in Israel.

Figures from the Israel Democracy Institute show that as of 2021, 43 percent of the ultra-Orthodox population lives in the Haredi centers of Jerusalem (26 percent) and Bnei Brak (17 percent); and another 24 percent live in Haredi suburban towns and settlements that were built in the 1990s – Betar Ilit, Modi’in Ilit, Elad and Ramat Beit Shemesh. The rest live in mixed cities or in small communities where Haredim make up a large majority of the population.

Despite the belief held by many that ultra-Orthodox housing ministers in recent years have served their own public more than anyone else, since the 1990s, when the city of Elad was built, no new ultra-Orthodox cities have been built in Israel. The attempt to market Harish as a city for Haredim also failed, though in this case it was a case of missed opportunity. Haredi bids submitted via nonprofit organizations as part of the competitive bidding process were disqualified when it was discovered that they had engaged in price-fixing, and today the city of Harish has a mixed population. The plan to build the Haredi city of Kasif in southern Israel also has gone nowhere.

The solutions offered by the government, including under ultra-Orthodox ministers, have been few: A few Mechir Lemishtaken (“Buyer’s Choice”) government programs that subsidize housing for first-time buyers in places like Beit Shemesh and Nof Hagalil; one such program in Bnei Brak, where the developer is real estate tycoon Oded Shriki from Netivot, who won the bidding process for the land; and urban renewal projects in Bnei Brak and Jerusalem, which can be counted on one hand, with the main barriers there being the height of the buildings and the owners’ apprehension over the possibility that other population groups will move in.

Since the 1990s, housing solutions for the Haredi public basically amount to planning new neighborhoods in existing cities like Netivot and Beit Shemesh, and the one planned for western Kiryat Gat. The rising housing prices have exacerbated the housing crisis for the ultra-Orthodox public, which has ended up gradually settling in neighborhoods in cities like Arad or Afula, until the point that the local authorities are compelled to allocate suitable public buildings for the community. Otherwise, they find cheaper, makeshift housing solutions in places like Jerusalem and Bnei Brak. Ultimately, most of the solutions for the housing crisis in the ultra-Orthodox community are found in the private housing market, and each is based on a compromise of some sort: living in very cramped quarters in expensive cities, or moving out to the periphery and hoping that a community that meets Haredi families’ needs will take shape there.

‘Not one big homogenous group’

So how does a young ultra-Orthodox couple find an apartment these days? “The Haredi public is not one big homogenous group,” says Shlomo Greineman, an Anglo Saxon Realty franchisee in Bnei Brak. “There’s the top 10 percent, which includes successful businesspeople, or families with inheritances, who have money. Then there are important people like rabbis or yeshiva heads, who may not have a lot of money, but have more options for obtaining money. Then there is the third group, which is most of the Haredi public, and with them question is, how do they manage to buy an apartment? Of course, not all of them buy apartments in Bnei Brak, where an old apartment costs more than 2 million shekels [$560,000] on average,” he says, adding, “The Haredi attitude is less about planning and more like, ‘God will help and it will be okay.’”

“Among the general public, there is talk about planning to be able to buy an apartment, about how to save money for a down payment. In the Haredi world, you’re tossed into the water,” he says. “The parents on both sides – bride and groom – give a little money, and the young couple takes a large mortgage, and lives very modestly. Because the parents are involved in the process, there is also family support and motivation to buy an apartment.”

Greineman says it’s customary for the bride’s parents to contribute more than the groom’s parents, which was originally meant to underscore the added value brought to the marriage by the groom’s Torah study. “Usually, the groom’s parents give 150,000-200,000 shekels on average toward the purchase of an apartment, and the bride’s parents give 300,000-400,000 shekels on average. The rest of the sum is taken out as a mortgage and that’s how the young couple starts out. The eldest children almost always end up receiving more parental assistance, because then come five or six or more marriages and it gets harder for the parents to help out.”

And where do the parents get the money? “Sometimes the parents take a small mortgage on their property,” says Greineman, “or they turn to a gemach [fund] for a long-term, interest-free loan with very good repayment terms, which are easy to find in any yeshiva. There’s almost always a grandparent in the picture who helps with another 50,000-60,000 shekels. The idea is to divide the burden into smaller bits. In Haredi society, it’s very common that when someone gets married, everyone pitches in to help. … There is also a central gemach to which people regularly contribute 50-100 shekels a month from the time their first child is born, and when that child eventually gets married, the parents can get a 150,000-200,000 shekel interest-free loan.

“In the Haredi community, whoever has money looks to see whom he can lend it to. He doesn’t put the money in the bank. If a person received 100,000 shekels in an inheritance, say, he is very likely to lend it to someone from the kollel [institute for Torah learning] at zero interest. And there’s no worry that the borrower won’t return the money, because everyone knows everyone. It’s the family’s reputation, and there is mutual responsibility.”

‘Money isn’t spent on appearances’

According to Greineman, those buying new, luxury apartments in central Jerusalem are affluent people with family in the United States, while those buying apartments in Bnei Brak also have well-off families, but the apartments there are more modest, older and in need of renovation. “They don’t spend money on appearances,” he explains. “Also, since they don’t use an elevator on Shabbat – whether or not the building has an elevator – the fourth-floor apartment is cheaper. A first-floor apartment can be up to 10 percent more expensive than a third- or fourth-floor apartment.”

In light of their rapid population growth, the Haredi public’s need for housing is acute. According to IDI, in 2022, the ultra-Orthodox made up 13 percent of Israel’s population – 1.2 million people – with every ultra-Orthodox woman having seven children on average. The Central Bureau of Statistics forecasts that by 2030, Haredim will make up 16 percent of the population, and that by 2039, this population will grow to 2.5 million. The government’s Urban Renewal Authority predicts that by 2040, the ultra-Orthodox community will need an additional 305,000 apartments – a challenge given that urban renewal projects are generally feasible when low construction is being replaced with high-rises but Haredim generally shun using a Shabbat elevator, which automatically stops on every floor and doesn’t require anyone to operate it.

Due to a lack of supply and the high housing prices, certain practices have become much more common in the ultra-Orthodox community. One Haredi businessman from Bnei Brak says, “There are some Haredim who choose to buy an apartment in Beit Shemesh or Elad. But that doesn’t appeal to someone whose life and family are centered in Bnei Brak, who wants to live in that city at all costs, even if it means living in a parking spot that was turned into an apartment. There are all kinds of building extensions that are done, many illegally, and the municipality also understands that it’s because of the residents’ needs. When a neighbor complains, the city comes down hard. But as long as there are no complaints, the city tries to approve whatever can be approved.

“There are building extensions that literally use up every last inch of space, so people will have somewhere to live. There are ‘apartments’ that aren’t registered as apartments in the Tabu,” he says, referring to Israel’s Land Registry. “Open spaces on the ground floor that were enclosed, or something built on the roof. … Haredim are less interested in how the property looks or its value, for the simple reason that they are just looking for someplace to live. A Haredi who buys an apartment is a Haredi who wants to live in the most Haredi city there is. He doesn’t care much about what state the property is in or what its registration status is.”

Another common practice in the ultra-Orthodox community is “shared Tabu.” Type these words into the search bar of Yad2, a popular site for apartment listings, and all the results will be in ultra-Orthodox cities. While a 60-square-meter (645-square-foot) apartment in Bnei Brak costs 2.3 million shekels and is out of reach for a young couple who wants to live in the city, shared Tabu is a popular alternative. The owner of a 120-square-meter apartment splits it in two and brings in a second buyer as a 50-percent owner and partner on the Tabu registration. The advantage is not having to pay tax on two apartments, but a very significant disadvantage is the inability to obtain a mortgage, since the property is not being purchased in full. The apartment is registered as a single apartment, but is actually divided. This is how a young couple can purchase a home inside an apartment in Bnei Brak for much less than market price.

There are instances of shared Tabu apartments that have been split in four or more parts. “A person is willing to get just a quarter of the Tabu, as long as he can live in Bnei Brak,’ says one Haredi businessman. “Whoever brings someone in as a joint owner of his apartment needs to trust him, because it’s like a marriage. Usually, it’s people who know one another from the same Hasidic court. A [member of the] ‘Lithuanian’ [non-Hasidic stream] wouldn’t bring in someone from Shas, for example. And people still draw up an agreement with a lawyer.”

If the young couple living in a 60-square-meter split apartment has children and wants to move, they will sell their part in the joint agreement. “There have been cases of owners who divided their apartments into a shared Tabu getting sued, and the division was canceled,” says the businessman. “So before entering into a shared Tabu, people speak to the neighbors to make sure they’re okay with it and often get them to sign something to that effect too. Somebody interested in buying an apartment in a shared Tabu will usually ask if the neighbors consent to it or if there has been problems… There are apartment owners who decide to build another unit on the roof, to rent it out. In this case, too, they seek the neighbors’ consent. The neighbors have to go along with it, sometimes it will be in exchange for something like the apartment owner replacing the building’s plumbing. With shared Tabu, 10 apartments in a building become 20. In other cases, especially in new projects in ultra-Orthodox neighborhoods, parking garages are turned into apartments and storage rooms.”

A real estate agent from Jerusalem says that the demand for apartments in the city is so high that a divided 40-square-meter apartment was recently rented for 6,800 shekels a month. “You don’t even find prices like that in Tel Aviv,” he says.

Exodus to the periphery

But some Haredim are not willing to live in such cramped conditions, and many are leaving the expensive cities and moving to outlying areas. Eli Rabinsky, 26, who comes from the Lithuanian stream, lived in Beit Shemesh before he got married; his wife was living in Jerusalem. When they got married, they bought an apartment in Harish, and their daughter was born there. “We decided to move away so we could have a better housing situation, and our parents worked out an agreement to help us buy an apartment in Harish,” he says. “In Israeli terms, Harish is considered far from Jerusalem and Beit Shemesh, but in another country it would be considered close.”

“I wasn’t specifically looking to live in a Haredi neighborhood,” Rabinsky says. “Our parents both grew up in mixed cities and mixed neighborhoods, because 30 to 40 years ago there were no Haredi cities, apart from Bnei Brak, and there were hardly any Haredi neighborhoods. My parents lived in Netanya and Kiryat Ata, and my wife’s parents lived in Petah Tikva and Haifa. They grew up in a heterogeneous environments, and learned to get along with everyone. I’m not counting on Harish being 100 percent or even 50 percent Haredi. We can learn to live together, and what ultimately matters most is the children’s education at home and at school.”

He explains, “Unlike the Ger Hasidim, where people all move together as an organized group – the rebbe gives an order of where to go just like in the army and everyone goes there – in the Lithuanian community, it’s not that easy to send young couples to the periphery. The vast majority want to stay close to the center of the country and to family, and they remain stuck there. Many people choose to live in makeshift apartments on the roof or in basements, with this fantasy that one day the prices will go down and they’ll be able to buy an apartment in Beit Shemesh or Jerusalem – and meanwhile the prices just keep going up.

“When I heard about Harish before I got married, I believed it would be a success: a new, developing city, in a good location off Highway 6 between Haifa and Tel Aviv. From what I saw, I believed that Harish would catch on, and that Lithuanian Haredim would ultimately choose to go there, because there aren’t enough new apartments in Beit Shemesh, Bnei Brak or Jerusalem that meet the community’s needs, in terms of both quantity and price. You have to break out of those places, and that’s what happened with us in the end. We bought a large, new four-room apartment with a balcony and a view, for about 1.1 million shekels. With the money our parents contributed and the little bit we’d managed to save, we had about 450,000 shekels, or about 40 percent of the purchase price. We took a mortgage for the rest.”

Rabinsky also notes how hard it is for parents to help all their children equally: “Naturally, when the first child gets married, the celebration tends to be more elaborate, and then little is left for those who are next in line. Also, with housing prices and rents going up all the time, even if you try to plan very carefully, it’s practically impossible for everyone to get the same help. My parents married off six children. My father is not a millionaire, but right after he got married, he started thinking about how he would afford to marry off his children, and he managed his finances accordingly. We didn’t live in poverty, but we did live very modestly – and that way he was able to ensure that we all could get an apartment eventually. It’s true that my sister bought a nice, large apartment in Beit Shemesh, but nine years ago, it cost the same as my four-room apartment in Harish. You need to look at it this way: What options do you have today and what options did they have at the time?”

Rabinsky adds, “It’s true that the center of Haredi life and the yeshiva world is in Jerusalem and Bnei Brak, but for me, the main thing is having what you need wherever you’re living – schools, synagogues and employment, rather than wedding halls or a shop to buy suits. Family is definitely important, but young Haredi couples generally go to their parents’ for Shabbat for a year or two [after getting married], and that doesn’t continue their whole lives. My parents don’t travel to visit their parents once a month, because they have their own lives. And if I feel like spending a Shabbat with my parents, the distance is not a big factor. I can drive an hour and be in Beit Shemesh.

“When you buy an apartment in a place like Harish, you’re buying quality of life, a spacious, proper apartment and not a matchbox like others choose to live in. Squeezing into a tiny living space just to keep living in Bnei Brak doesn’t make sense to me. When I get up in the morning, I need a grocery store and schools for the kids, not a shop selling men’s suits. If I need suit, I’ll travel to Bnei Brak once a year to buy a suit. When there’s a wedding in Jerusalem once in a while, we drive longer to get there. It’s worth the price.”

Beyond his personal experience, Rabinsky is well acquainted with the dilemma of whether to leave the centers of Haredi life for the periphery. His father, Rabbi Zvi Rabinsky, is a member of the Ashkenazi Haredi party Degel Hatorah’s housing committee, which aids young couples in moving to the periphery. “My father was one of the first Lithuanian Hasidim to move to Beit Shemesh,” he says. “When he went there, people laughed at him, and now the city has developed and grown along with the Haredi community that has settled there, and it has ultra-Orthodox schools for boys and girls, yeshivas, kollels – everything.

“You have to remember that having ultra-Orthodox schools is a result of need. In Afula, for instance, there is a significant Lithuanian presence now. Over the past decade, 500 to 600 Lithuanian families have come to the city. Over time, an answer to all the community’s needs is found. There is even a yeshiva gedola [post-secondary yeshiva] there with 300 students that grew along with the community. The community there has grown so much that there are no longer any apartments available in the Givat Hamoreh neighborhood and the Lithuanian community in Afula has expanded to adjacent Afula Ilit.

“This is exactly what my father tries to explain to young people. Nof Hagalil, for example, is not as remote as it sounds. Until a year ago, you could find apartments in the center of town there for 400,000 shekels. You only needed 100,000 shekels for a down payment and you had an apartment. Whoever really wants to buy an apartment can do it. It’s all a matter of motivation. You have to stop looking for excuses why not, and not to be spoiled about it. You have to understand that in the end, you’ll find quality of life in having a spacious apartment of your own, rather than moving from a 30-square-meter space into a 35-square-meter space. Before we came to Harish, we lived for six months in a 30-square-meter unit. I don’t understand how people live this way.”

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Rabinsky, who works from home and has a job in the field of communications, agrees that there’s a cost to moving to the periphery. “People often tell me that there are no jobs in Harish, and I tell them that if they check how many of the Haredim in Beit Shemesh work in Beit Shemesh, they’ll see that most of them work in Jerusalem and Gush Dan. In the end, it’s all a matter of development, and just like Elad and other new cities had similar problems in the beginning, the same is true in Harish. There’s no magic solution. My wife works as a back office secretary in the bookkeeping department of Kibbutz Mishmarot, next to Pardes Hanna. And it’s true that I used to have to drive her there 20 minutes each way, because there’s no direct bus and the public transportation options in Harish aren’t that great. But I know that transportation and employment opportunities here are just a matter of time. I don’t see the distance as a barrier. When we want to go somewhere, we drive.”

Rabinsky’s father once had his doubts about Harish, but not anymore. “Over the years, my father directed dozens of couples to the periphery. But when I told him that I wanted to buy an apartment in Harish, at first he said: ‘Harish? There’s no Lithuanian Haredi community there. You’ll leave after two months. You need a society that speaks your language.’ I told him then that the Lithuanians will discover the city, and when he came to visit two years ago and saw the city up close, he realized that I was right. When we arrived, there were 10 Lithuanian families in Harish, when my father was sure there wasn’t any Lithuanian community at all. We bought an apartment, and then my brother decided to buy an apartment here just a month later. Now there are close to 200 Lithuanian Haredi families here, and many more on the way.”