Bank of Israel Data Reveals Sharp Rise in Average 2026 Mortgage Amounts
Bank of Israel data for 2026 shows mortgage volumes rising by 10%, driven largely by a sharp jump in average loan sizes rather than an increase in new borrowers.
An analysis of Bank of Israel data reveals an intriguing trend in the mortgage market for 2026: while total issuance volumes continue to rise, this growth is driven not by a surge in new borrowers, but by a sharp increase in the average mortgage amount each family is forced to take.
Comparing complete data from March to July between 2025 and 2026, the total volume of mortgages issued for housing purchases increased by 10%. However, a deeper dive into the growth drivers shows that 7% of this increase stems from higher average loan amounts, while the number of individual loans grew by a mere 3%.
Surge in Average Loan Sizes
According to a special analysis by the Mortgage Consultants Association, when examining all mortgages (including general-purpose loans), total growth stands at 9%. This entire increase is attributed to the rising average loan amount, whereas the absolute number of loans taken remained unchanged. It is worth noting that a significant portion of mortgage volume fluctuations is driven by refinancing: each refinancing counts as a new loan, creating the illusion of heavy market activity despite a declining number of real estate transactions.
Average mortgage amounts for home purchases jumped sharply from 1.12 million NIS to 1.23 million NIS. For alternative housing, the average loan climbed from 1.29 million NIS to 1.42 million NIS. Meanwhile, mortgages for investment properties surged from 1.17 million NIS to 1.37 million NIS—an astonishing 17% increase.
Investors Pay More Despite Fewer Purchases
"The financial burden on each individual borrower is deepening significantly, driven by skyrocketing housing prices compared to 2020 levels."
For first-time or single-home buyers, the average mortgage amount climbed from 1.05 million NIS to 1.15 million NIS. This price inflation is likely a primary reason real estate investors are scaling back their market participation. It is not merely high interest rates, but soaring property values that defied even the most optimistic forecasts over the past two years.
Key trends by loan purpose indicate that investors are buying fewer properties but paying significantly more: the number of mortgages taken by investors dropped by 21%, yet a 17% rise in the average loan amount offset most of this decline, leaving total volume in this segment down by only 8%.
Second-Hand Versus Contractor Purchases
The increase in average loan size was particularly pronounced in the second-hand and self-build sectors, rising from 1.14 million NIS to 1.26 million NIS, compared to a more moderate increase for contractor-purchased apartments, which grew from 1.09 million NIS to 1.18 million NIS. Ultimately, the mortgage market maintains high activity levels, but the individual financial strain continues to mount.
