The Bank of Israel announced today that it has lowered the interest rates by 0.25% to 3.5%. 

This is the fourth reduction over the past year (in November 2025 the interest rate was 4.5%). The continued downward trend reflects increased confidence in the Israeli economy and points to continued economic recovery, a strong shekel, a resilient labor market and easing of geopolitical tensions.  

The lower interest will help the real estate market as lower interest means smaller mortgage payments.