Sunday, June 30, 2013

Israel's mobile market: catching up with price wars

Israelis are some of the chattiest mobile users. They are also a bit gadget crazy. But until a year ago, mobile service prices were about 2 to 3 times what they were in Europe. Nobody could explain this. There are three large mobile service providers: Pelephone, Cellcom, and Partner (Orange). So it wasn't the problem of competition. While prices for service and phones was high, Israelis still kept on blabbing and paying (average of 250 shekels a month, about $70). A year ago (May 2012) Golan Telecom started business by offering “all you can use” monthly packages for 99 shekels. This offer shook the mobile operator market and soon the main operators started offering even lower price monthly packages (down to 70 shekel, about $19). A year later, about half of the Israeli mobile phone users have switched to the low cost packages. This is to some concern to both operators and government regulators. Mostly because it means that half of the users have older packages and are probably paying much more (the old rates, before Golan came out.)  

Saturday, June 29, 2013

Luxury Homes in Green: Gardens and Parks (in the city)

The first impressions of Israel people remember is “the green”. It surprises Europeans and Americans, who come from wet climate, to see so much green foliage in a semi-arid environment. Israel's history explains the obsession with making the land green. So today, one of the luxuries in living is having a private garden or living close to a public garden. The ultimate luxury is a private garden, no matter how small. From a few large pots on a balcony to a piece of land enough for one large fruit tree. All the way to living at the edge of a public garden (similar to American obsession of building at the edge of a private golf course.)

Friday, June 28, 2013

Opportunity for Americans: Israeli Luxury Home Market: Turning Normal?

Israeli real estate market has been in an upmarket phase for over two decades. Luxury homes and apartments were the engine that drove building and architecture fields into a strong and growing market segment. Luxury construction has even become a vital export segment. Israeli architects and builders are exporting construction services due to their luxury construction experience. Finally, luxury construction has been a key Israeli success story, to the point, of attracting investors and individuals to buy homes in Israel, bringing in dollars and euros. With all that, it seems like the luxury propery party is over, or at least taking a rest. Luxury apartments in the Tel Aviv area are not selling in 2012 as fast as they did earlier. Also, high visibility projects with very high price units (above 100 million shekel per property, about $50 million) are also sitting without much interest. (where are Ellison, Brofman, and Adelman when you need them?) 

Thursday, June 27, 2013

100 Days to Lapid and Bennett Governing REVOLUTION!

Yesterday (Tuesday 25-June-13) was the 100th day anniversary of Yair Lapid's and Naftali Bennett's in office. Israeli media and government has taken a page from the American administration change: promise to make sweeping changes in the first 100 days in office. After all, if you have an agenda and you think you can change how government serves the citizens, you should be able to do something right away.

Tuesday, June 25, 2013

Economic Wows: Between A Social Contract and Adam Smith

Israel's economic state is in a constant state of change. Israel's economy took a turn for the worst in the last four years. There are two culprits for the change. The first is Netanyahu's government liberal spending both on infrastructure and on social benefits. The second is the global downturn, mostly the downturn in Europe. Contrary to general belief, Israel is not yet in the category of a developed country. While there are many similarities with European and developing countries (i.e. BRIC). As BRIC block countries are making  fast economic progress based on vast natural resources and progressive economic changes, Israel's economic progress is strictly based on high productivity and structural advantages. The difference between Israel's economic progress is clear to see over the last decade. While Israel's economy has grown by 4%,most BRIC growth rate ran an average of 8% with up to 12% in China some years (China 10%, India 9%, Brazil 4%, Russia  7%; average yearly GDP growth 2003 to 2013).