TAMA 38 for Apartment Owners Living Abroad
TAMA 38 for Apartment Owners Living Abroad
Many Americans own apartments in older buildings in Tel Aviv, Ramat Gan, Haifa or Jerusalem, sometimes bought decades ago and sometimes inherited from parents. These buildings are the natural target of TAMA 38, the national outline plan designed to strengthen residential structures against earthquakes. The plan allowed developers to add floors or units in return for reinforcing the building and upgrading it for existing residents. If your neighbors have started talking about a TAMA project, you are about to make a decision that affects the value and livability of your apartment for a generation. This page walks through that decision from the perspective of someone watching from abroad.
What TAMA 38 actually is
TAMA 38 is a national outline plan that granted extra building rights to older residential buildings that were designed before the Israeli seismic standard took effect. Those rights are the currency of the deal. A developer uses them to build and sell new units, and the proceeds fund reinforcement of the structure and improvements for the original owners.
The national plan has been phased out in favor of municipal renewal plans and local planning policies, and each city now sets its own rules. Some buildings still proceed under permits and applications submitted under the original framework, while others move under the newer local tools. A lawyer who follows your city's policy can tell you which route applies.
Reinforcement or demolition
There are two versions. In the strengthening version, the existing building stays, the structure is reinforced, an elevator is often added, and each apartment typically gains a reinforced safe room and sometimes a balcony. New units are added on the roof or alongside. In the demolition version, the building is taken down and replaced with a new, taller one in which each owner receives a new apartment, usually somewhat larger than the old one, plus parking and storage where the plan allows.
Strengthening is quicker and residents may stay during works, though the process is noisy
Demolition means moving out for the construction period with rent paid by the developer
Demolition usually produces a better final product but carries a longer timeline
Reviewing an offer from overseas
An offer arrives as a draft agreement with technical specifications, floor plans and a set of guarantees. Do not evaluate it alone. Compare it with what similar buildings in the same street received, check the developer's track record through public court records and completed buildings you can visit, and make sure the owners' lawyer has been chosen by the owners. Video calls with the lawyer and the supervising engineer make it possible to follow the negotiation from any time zone.
Key terms to look for
The agreement should state the size and location of your new unit, the finish specifications, parking and storage, the construction timetable, compensation for delays and the guarantees that protect you if the developer fails.
A bank or insurance guarantee covering the value of your apartment
Rent guarantees in the demolition version
A warranty period for defects after delivery
Clear rules on who bears the taxes arising from the deal
Tenants and rental income
If you rent your apartment out, a strengthening project may disrupt your tenant, and a demolition project will end the lease for the construction period. Build that into your planning, check your lease for termination clauses, and confirm that the developer's rent payments begin at the right time so your income is not interrupted.
Taxes and paperwork
TAMA projects have historically enjoyed certain tax relief in Israel, but the details depend on the track and on your circumstances. On the American side, receiving a new or improved apartment may need to be reported, and your ownership may already appear on FBAR or other foreign asset filings. Speak with an Israeli tax advisor and a US CPA, and keep copies of every signed document in one digital folder.
Frequently asked questions
Is my building eligible for TAMA 38
Eligibility depends on when the building permit was issued, on the city's current policy and on any local plan that has replaced the national framework. A local engineer or lawyer can check quickly.
Can I sign electronically from the United States
Some documents can be signed remotely, but agreements usually need verified signatures. Many owners sign before a notary with an apostille or at an Israeli consulate.
How long does a TAMA project take
It varies widely with permits, neighbors and the developer. Strengthening projects are usually shorter than demolition projects. Ask for a realistic schedule in writing.
What if the developer goes bankrupt
That is exactly what the guarantees are for. Make sure your lawyer confirms they are issued by a recognized bank or insurer before work begins.
Elkayam Group
TAMA 38 is one of the core fields of Elkayam Group, together with pinui-binui, development and combination deals. Working with backing companies and partners, and able to provide guarantees, the group brings three generations of family experience to renewal projects. We speak Hebrew, English and French, so owners in America can ask detailed questions and get direct answers.
Tell us about your building and we will help you understand whether a TAMA route makes sense.
+972-53-658-4252 · support@kobielkayamrealestateltd.com · Rival St 37, Tel Aviv