Tama 38 Investment Guide
Tama 38: Israel's Best-Kept Investment Secret
How a seismic safety program creates 40-60% property appreciation — the smart investor's guide
Official market data — Israel (CBS, 2026)
National average: ₪2,392,000 in H1 2026 (+3.9% vs. H1 2025); the CBS housing price index for February–March 2026 was down 1.2% year on year
Purchase tax for a foreign resident or investor: 8% up to ₪6,055,070 and 10% above; bank financing for non-residents is capped at 50% of the property value (up to 75% for an Israeli resident buying a single home)
Source: Israel Central Bureau of Statistics — average apartment prices for the first half of 2026 (published 15 September 2026), the housing price index (published 15 May 2026) and the Q1 2026 rent survey. These are city-wide averages; the actual price depends on the neighborhood, size, floor and condition. Before any decision we show you real transactions recorded with the Israel Tax Authority in the area you are considering.
Market data (estimates)
Price range:Variable — purchase at current market, gain 40-60%
What is Tama 38?
Tama 38 (National Outline Plan 38) is Israel's government program to strengthen buildings constructed before 1980 against earthquakes. In exchange for reinforcing the structure, developers receive rights to add floors, expand apartments, and build new units. For property owners, it means a free renovation and significant value increase.
Two versions exist: Tama 38/1: Strengthen the existing building + add floors + expand apartments (typically adding a safe room/mamad of 12-25 sqm to each unit). Tama 38/2 (Pinui Binui): Demolish and rebuild entirely. Owners receive brand new, larger apartments in a modern building with parking and lobbies.
The Investment Strategy
Buy an apartment in a building with an approved or advancing Tama 38 project. The purchase price reflects the current (old) building condition. After the project completes, your apartment is renovated/rebuilt and worth 40-60% more. It's essentially buying a renovation project where someone else pays for and manages the work.
Best cities for Tama 38: Tel Aviv, Ramat Gan, Givatayim, Bat Yam, Holon, Petah Tikva, Herzliya. Due diligence checklist: Verify owner consensus percentage, check building permit status, review developer financials, understand the timeline, and confirm your specific apartment's expansion plan.
Risks and Mitigation
Tama 38 is not risk-free: projects can stall due to owner disputes, developer financial issues, or regulatory changes. Mitigation strategies: focus on projects with 80%+ owner approval, choose developers with proven track records, verify building permit has been issued, and get your attorney to review the Tama 38 agreement thoroughly.
Advantages
Free renovation
40-60%+ appreciation
Zero cost to owner
Modern upgrades
Added safe room and parking
Points to consider
Long timelines
Project uncertainty
Construction disruption
Dependent on developer quality
Owner consensus challenges
How much does my apartment appreciate after Tama 38?
Typically 40-60% for Tama 38/1 (reinforcement + expansion) and 50-80% for Tama 38/2 (demolition-rebuild). The gain comes from: expansion (mamad, balcony), renovation (new kitchen, bathrooms, finishes), added amenities (elevator, parking, lobby), and the modern building premium.
Do I have to pay anything for the renovation?
No. In a standard Tama 38 deal, the developer bears all costs of reinforcement and renovation. In exchange, they receive rights to build new units for sale. Your apartment is expanded and renovated at zero cost. You may need to temporarily relocate during Tama 38/2 (developer covers relocation costs).
How long does a Tama 38 project take?
Tama 38/1: 18-30 months of construction (you can usually stay during work). Tama 38/2: 3-5 years total (including planning, permits, and 24-30 months construction). During Tama 38/2, you're relocated at the developer's expense for the construction period.
Find Tama 38 OpportunitiesWe identify the best Tama 38 investments for youPersonal consultation: +972-53-658-4252 · leave your details and we will get back to you