What Is the Israel Land Authority and How Does It Impact Me?

When you buy a home in Israel, chances are the land beneath it isn’t privately owned — it’s actually leased from the state. The vast majority of the land in Israel is managed by the Israel Land Authority (ILA), often referred to in Hebrew as the minhal. The Israel Land Authority is the government agency that regulates how 93% of the land across the country is used, developed, and transferred. It is responsible for land allocation, lease terms, upgrades, and development approvals for all land owned by the State of Israel, the Jewish National Fund (JNF), and the Israel Development Authority.

The ILA is overseen by the Israel Land Council, which is chaired by the Minister of Housing and Construction. While the Council sets national land policy, the ILA is the body that carries it out.

Why does this matter to me as a buyer?

When buying property in Israel, instead of buying the land outright, you’re oftentimes purchasing long-term lease rights that function almost like ownership — typically for 49 years, with a built-in renewal for another 49 years. Known as chakira in Hebrew, this leasehold ownership is usually renewable, transferable, and inheritable. It is particularly common in urban areas.

While the Israel Land Authority manages these properties, the lease agreements and ownership transfers are recorded with the Land Registry (Tabu) or the housing company managing the project.

How does lease payment work?

The long-term lease is usually paid as a one-time fee, known as “lease capitalization” (hiyuvon). This payment covers the full value of the lease for the entire period (usually 49 or 98 years). If your lease hasn’t already been capitalized, you may need to pay this fee when renewing, selling, expanding, or converting the lease to ownership. Once paid, you usually won’t owe additional lease payments to the ILA.

How do I renew my lease?

As previously mentioned, most leases include a renewal clause. While not automatic, renewal is generally granted, especially for residential properties, as long as you’ve followed the terms of the lease and paid the applicable fees, such as a lease extension fee or the cost of full capitalization.

Can the Israel Land Authority refuse to renew my lease?

In rare cases, yes. For example, if you violated lease terms, failed to pay required fees, or if the land is needed for public use. For standard residential properties, renewals are typically routine or replaced by a conversion to ownership. Agricultural and institutional leases, however, are more conditional.

Can I convert my lease into full ownership?

Yes, under recent reforms, you can usually convert lease rights into ownership by paying any outstanding land value, especially in urban residential buildings. This process can simplify your rights and reduce future dealings with the ILA.

Can I renovate or change the use of the property?

You generally need to request permission from the Israel Land Authority for expansions, subdivisions, or rezoning. In many cases, you’ll be charged a betterment levy (hetel hashbacha) based on the increased land value resulting from the change in status.

Does all of this apply to foreign buyers?

Fees are generally the same, but eligibility matters. If you qualify under the Law of Return, you can lease ILA-managed land just like an Israeli citizen. If not, you may be restricted from leasing state land altogether — which is why many foreign buyers choose private land, which offers full ownership and fewer limitations.