In short
What are a buyer's rights against a developer for defects or late delivery?
The Sale (Apartments) Law, 5733-1973, requires the developer to repair defects found during the inspection period (bedek), which runs from one to seven years depending on the type of defect, followed by a three-year warranty period. For late delivery, the law sets predetermined compensation based on the rent of a comparable apartment.
Before You Sign the Developer's Contract
The contract with the developer (kablan) was drafted by the developer's own lawyers. Before signing, it pays to review the technical specification, the delivery date and the clauses that release the developer from liability, and to make sure every payment is secured by a Sale Law guarantee (arvut chok mecher) under the Sale (Apartments) (Assurance of Investments of Persons Acquiring Apartments) Law, 5735-1974.
Pay particular attention to the specification: what the apartment includes, what counts as a change that costs extra and what the developer may substitute without asking. Linkage to the construction inputs index (madad tsumot habniya) also affects the final price.
Late Delivery of the Apartment
The Sale (Apartments) Law, 5733-1973, provides for monthly compensation with no need to prove damage, based on the rent for a comparable apartment. For contracts signed from July 7, 2022 (Amendment 9 to the law), there is no compensation for the first month of delay; from the second to the fourth month the compensation equals the rent, from the fifth to the tenth month it is 1.25 times the rent, and from the eleventh month 1.5 times. For older contracts, a delay of more than 60 days carries compensation from the first day: 1.5 times the rent for the first eight months and 1.25 times from the ninth month. A developer who claims the delay was caused by circumstances beyond its control has to prove it.
Keep every notice the developer sends you about the delivery date. A contract clause that cuts the compensation below what the law sets is invalid, because the provisions of the law can be changed only in the buyer's favor.
Construction Defects and Nonconformity
When construction defects appear, notify the developer in writing within the inspection period (tkufat bedek), document the defects, get an engineer's opinion and give the developer a reasonable opportunity to repair them. If the developer does not make the repairs, you file a claim.
The inspection period ranges from one year to seven years, depending on the type of defect, and is followed by a further three years of warranty. Dampness, cracks, flooring and electrical problems are the most common defects in new apartments.
What the service includes
- Contract and specification review before signing
- Claiming compensation for late delivery
- Claims for construction defects and nonconformity with the specifications
- Negotiating with the developer before a claim is filed
When to contact us
- Before you sign a contract with a developer
- The delivery date has passed and the apartment is not ready
- You found defects in your new apartment
- The developer refuses to make repairs or demands extra payments
What to bring to the meeting
- The sale contract and the technical specification
- Appendices for changes and add-ons
- The developer's notices about the delivery date
- Photos of the defects and the handover report
Buyers vs. Developers throughout Israel
The firm represents clients from all over Israel: Jerusalem and the Shfela, Be'er Sheva, Ashdod and Ashkelon, Haifa and the North, the Sharon and Gush Dan. Meetings take place at our two Modiin branches, at the WE Towers branch in Tel Aviv or by video call, and documents can be sent in advance on WhatsApp. We represent clients in the courts, the Labor Courts and before planning committees throughout Israel. How we work with clients across Israel.
Frequently asked questions
How much compensation am I owed when a developer delivers an apartment late?
Under the Sale (Apartments) Law, 5733-1973, you are entitled to monthly compensation with no need to prove damage, based on the rent for a comparable apartment. For contracts signed from July 7, 2022: no compensation for the first month, the rent from the second to the fourth month, 1.25 times from the fifth to the tenth month and 1.5 times from the eleventh month. For older contracts: 1.5 times for the first eight months and 1.25 times after that, when the delay exceeds 60 days.
What should I do if construction defects appear after delivery?
Notify the developer in writing within the inspection period, document the defects and get an engineer's opinion. You need to give the developer a reasonable opportunity to repair them. If it does not, you can sue for the cost of the repairs.
Why do I need my own lawyer when buying from a developer?
The project's lawyer represents the developer. A lawyer acting for you reviews the contract and the specification, makes sure your payments are secured by a guarantee and negotiates the clauses that limit the developer's liability.
Can I refuse to take an apartment that has defects?
Minor defects usually do not justify refusing the apartment. They are recorded in the handover report. It is different when the apartment is not fit to live in, and you should get advice before refusing.
What is a Sale Law guarantee?
A bank guarantee that secures the money you paid the developer if the apartment is not delivered, for example because the developer collapses financially. Make sure you receive a guarantee for every payment.
