Good news for buyers of property under construction

Delay penalties in real estate projects in Israel are designed to encourage developers to deliver apartments within the agreed time frame. The delay penalty mechanism is reversed, which means that the longer the promoter delays delivering the project, the more the penalties increase.



Concretely, for each month of delay after the first month, the promoter will have to pay penalties calculated in an increasing way as the months of delay. This measure is retroactive to the first day of delay. Consequently, the longer the promoter delays, the more the penalties increase, which constitutes a strong incentive to meet the deadlines.



In addition, the penalties must be paid month by month, which allows the buyer to pay his rent regularly, without having to wait for the end of the period of delay to receive the penalties due. This measure reinforces the protection of the buyer by guaranteeing that he has a regular income to cover his housing costs.



In sum, the mechanism of late penalties in real estate projects in Israel is an important tool to guarantee the respect of delivery deadlines for real estate projects and to protect buyers. It encourages developers to deliver apartments on time and allows the buyer to benefit from financial protection in the event of delay.