The Achim La’Bayit Program

Achim La’Bayit is a new program at IFLA that helps families with limited financial means become homeowners in a financially responsible way, through financial literacy training, personal guidance, family coaching, and in special circumstances supplementing their down payment with an interest-free loan from IFLAs.

Click here to support IFLA’s Housing Program!

Background – Israeli Housing Market

Since 2008, housing prices throughout Israel have increased 120%, particularly in neighborhoods where real estate used to be more affordable.  Without a simultaneous equivalent increase in the average wages,  large segments  of Israeli society are now unable to purchase a home.  While this situation impacts all Israelis, it has become nearly impossible for low or even middle income Israelis to buy a home including many new immigrants.   This is a significant shift in Israeli society where historically homeownership has been the norm, regardless of income bracket.

The biggest challenge to buying a home in Israel today is a result of Israeli bank policy which allows for mortgages up to 75%.  As a result, first time home purchasers have to provide at least 25% as a down payment, something which most young couples simply cannot do.

This creates challenges at more than one point throughout a family’s life cycle and throughout Israeli society.

Despite the increasing costs of  purchasing an apartment  today making  home ownership almost impossible for many low-middle income families, government efforts to bring down housing prices have proven ineffective.  With this problem affecting wide swathes of the population, it is seen as one of the major socio-economic challenges facing the Israeli public today.

In 2013, the organization Achim La’Bayit was founded to provide financial literacy coaching about homeownership.  By joining IFLA in 2017, the Achim La’Bayit program can now offer both financial coaching and supplemental loans for a first down payment.

 Achim La’Bayit’s program provides the following:

  1. Guidance and Financial Literacy: For low income families, the idea of purchasing a n apartment seems unreachable .  Achim Labayit provides guidance from the very first step of a purchase including helping the family to see how homeownership is even attainable.  This process includes training on all considerations that should be taken into account in becoming a homeowner as well as family budgeting guidance from an Achim Labyit coach.  Staff are by the family’s side even after the learning stage and also assist  them to find the home that meets their needs and fits their budget.
  1. Financial Assistance: After the coaching process, some families still lack a full down payment.  This may be because the bank mortgage offered  is low, or because they lack outside resources.  As an example, for a low income couple to put 25-40% down on a two bedroom apartment worth $250,000 is nearly impossible without help from family, which is not always available.  In such situations, IFLA will provide a supplementary loan for a portion of the down payment.
  1. How it works:
Achim La’Bayit provides the following unique services:
  1. Guidance and Financial Literacy: For low income families and many new immigrants, the idea of purchasing a n apartment seems unreachable.  Achim Labayit provides guidance even before the very first step of a purchase including helping the family to see how homeownership is even attainable.
  2. Financial Assistance: After the coaching process, some families still lack a full down payment.  This may be because the bank mortgage offered  is  low, or because they lack outside resources.  As an example, for a low income couple to put 25% down on a two-bedroom apartment worth $250,000 is nearly impossible without help from family, which is not always available.  In such situations, IFLA will provide a supplementary loan for a portion of the down payment.
  3. Sustainable Giving: Loan recipients are asked to “pay it forward” by committing to a monthly donation to help future IFLA recipients receive housing loans.

 

Donate today to support this program:

Donate via Paypal to American Friends of IFLA (AFIFLA)

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* U.S. tax deductible contributions are made to American Friends of IFLA (AFIFLA, 501(c)3).