Under Bank of Israel lending caps in force in 2026, banks may finance up to 75% of the price of a single/first home, so the minimum down payment is 25% — a 2,000,000 ₪ apartment requires at least 500,000 ₪ in equity, with a maximum mortgage of 1,500,000 ₪. For an investment (additional) home, financing is capped at 50%, meaning at least 50% equity.
How is it calculated?
The calculation is based on the Bank of Israel's loan-to-value (LTV) caps — a stable directive still in force in 2026. Pick the purchase type, and it sets the maximum financing rate: up to 75% of the price for a single/first home, and up to 50% for an investment (additional) home. The minimum equity is the complement — 25% of the price for a single home or 50% for an investment home — and the maximum mortgage is the remainder. Home upgraders (mashprei diur), who sell their existing home and buy another in its place, count as single-home buyers under certain conditions.
Example: a first home at 2,000,000 ₪ — minimum equity of 500,000 ₪ (25%) and a maximum mortgage of 1,500,000 ₪. Note that your equity also has to cover side costs: purchase tax, legal fees, broker fees and moving — in practice, budgeting about 5% above the minimum is common. Also, the cap is only a ceiling: actual approval depends on income and repayment capacity, and banks limit the monthly payment to roughly 40% of net income.
Frequently asked questions
How much down payment do I need for a first home of 2 million ₪ in Israel?
At least 500,000 ₪ — 25% of the price. The Bank of Israel lets banks finance up to 75% of a single/first home, so the maximum mortgage is 1,500,000 ₪. In practice, buyers commonly budget about 5% more for side costs like purchase tax and legal fees.
How much equity is required for an investment property in Israel?
At least 50% of the price. For buyers who already own a home, the Bank of Israel caps financing of an additional home at 50% — an investment apartment at 2,000,000 ₪ requires at least 1,000,000 ₪ in equity.
Do home upgraders count as first-home buyers for the mortgage cap?
Under certain conditions, yes. Someone selling their only home and buying another in its place counts as a single-home buyer for the LTV cap, so they qualify for up to 75% financing and a 25% minimum down payment. Note that the cap is only a ceiling — actual approval also depends on income and repayment capacity.
This calculation is a general estimate for illustration only. It does not constitute tax, pension, or investment advice, nor a substitute for personal advice from a licensed professional, and should not be relied on for decisions.
