Support for First-time Homebuyers from the Socioeconomic Periphery

Launched in 2016, Ogen La’Bayit is the only charitable project in Israel set up to address the housing crisis, the single biggest financial challenge for young families from disadvantaged backgrounds in Israel today. Ogen La'Bayit works to provide young, working couples from Israel’s socioeconomic periphery with free financial analysis, financial tools for life, and guidance along every step of the homeownership process. This vital service routinely prevents young couples with limited knowledge from making disastrous financial decisions as they strive to purchase their first home and sinking further into financial distress. Just as importantly, the Ogen La'Bayit process helps young families at the periphery of Israeli society to feel aspirational: to put down roots, invest in their families and communities, and move forward towards a better future, thus contributing to Israel’s socioeconomic growth and resilience. THE NEED For 10 years, rising housing prices combined with the lack of affordable long-term rental options and Israel’s high cost of living have left tens of thousands of young families financially trapped: unable to buy a home and unable to save while renting. As a result, longstanding financial inequalities grow wider. Tens of thousands of Israelis from low and moderate-income backgrounds are caught in a lifelong cycle of overpriced, volatile home rentals, all the while their household debt grows and they struggle to develop the modest net worth required to hand a stronger start in life to their children. The pandemic greatly exacerbated the longstanding housing boom, further underscoring socioeconomic gaps and the need for Ogen La’Bayit. Housing prices continue to rise sharply, growing at 10% over the past year alone, the steepest annual price increase since 2010. The number of homes being purchased is now fully 10% higher than it was last year, with mortgage taking also at record highs. According to the Central Bureau of Statistics, the average price of a four-room home in Israel rose to a record NIS 1.65 million in the first quarter of 2021, exceeding $500,000 for the first time. The challenge of access to affordable homeownership is made worse because of a widespread lack of financial literacy. Among the young families Ogen La’Bayit supports, many manage their finances poorly: overspending, not saving and living through their overdraft and an endless cycle of loans. *How Ogen La’Bayit Works* Through personalized financial coaching, Ogen La’Bayit’s small professional team of family-economics consultants assists hardworking families from modest financial backgrounds to: 1. Assess each family’s overall financial status 2. Provide tools to improve on monthly income and expenses 3. Help clarify each family’s housing needs, choices and budget limitations 4. Assess whether to: • Try to buy, which includes finding the right home, identifying the right mortgage, understanding the legal process and providing, if needed, a supplementary interest-free loan of up to ILS 100,000 through Ogen - Free Loan Fund to help with a down payment. • Wait, and in the meantime build a long-term savings plan, create better future prospects, ensure the family avoids excess debt, check-in to ensure steady growth, and ultimately help to buy in the future, at the right time. Annual Impact of Ogen La'Bayit ✓ Financial guidance for 1,000 families every year ✓ Over 300 apartment purchases a year ✓ ILS 10 million in interest-free loans provided every year to supplement equity