The West Bank Real Estate Game: Uncovering Subsidies and Land Practices in Settlements

Property buyers in sought-after settlements pay full price, while developers enjoy state-subsidized land in less desirable areas.

Property buyers in sought-after settlements pay full price, while developers enjoy state-subsidized land in less desirable areas.

Property buyers in sought-after settlements pay full price, while developers enjoy state-subsidized land in less desirable areas.

Shuki Sadeh

in collaboration with

August 3, 2023


An Israeli construction company, Binyanei Bar Amana, affiliated with the Amana settlement movement, is currently selling duplexes in Peduel, a highly sought-after middle-class settlement adjacent to the Green Line. While the company received the land in Peduel from the state at no cost, it is selling properties there at full market value. For instance, a 198-square-meter duplex apartment is being sold for 3.4 million shekels ($930,000), disregarding the fact that the land was acquired without any financial outlay.

Interestingly, Binyanei Bar Amana is also selling properties in other settlements at significantly reduced prices. In Beit Hagai, a settlement in the southern Hebron Hills, a four-room apartment is offered for just 1.3 million shekels ($360,000). In the Kerem Reim outpost, officially part of the Talmon settlement near Ramallah, a four-room apartment is also priced at 1.3 million shekels, while a five-room garden apartment with a 30-square-meter garden costs 1.6 million shekels ($445,000).

The disparity in pricing raises questions about the company's practices. Ze’ev Hever, the general secretary of Amana, provided an explanation during a Gush Etzion Regional Council meeting in January 2022. He confirmed that Binyanei Bar Amana operates as a for-profit company and uses strategic subsidies to balance the profits earned from selling properties in popular settlements with those in less desirable areas. By doing so, they incentivize people to live in settlements that are farther from the Green Line, where demand is lower and construction is more challenging due to developer reluctance.

Ze'ev Hever (Light) and PM Benjamin Netanyahu in 2019. Photo by: Reuters

The extent of these subsidies becomes evident when comparing settlements like Elkana, located approximately half an hour from Peduel. In Elkana, a 3,800-square-foot plot for a duplex construction was sold for between 1.7 and 1.8 million shekels ($472,000 and $500,000). Meanwhile, in Peduel, residents purchasing a ready-to-inhabit apartment for 3.5 million shekels are unknowingly contributing a significant portion of that amount as an informal tax levied by the Gush Emunim movement. This “Amana Tax” subsidized housing construction in other settlements.

The settlements in question can be broadly categorized into two types. The first includes smaller settlements, like Peduel, where the state distributed land at no cost through the World Zionist Organization. Residents in these settlements are authorized to live there but do not officially own the land. Amana makes political use of such land, utilizing cross-subsidization between settlements to balance profits and losses. Some settlements, like Revava and Avnei Hefetz, yield profits for Amana, while others, like Rehelim, Yuvalim, and Teneh Omarim, do not yield any profit.

The second type comprises larger, urban-like settlements like Elkana, built by the Housing and Construction Ministry. The land in these settlements is sold through tenders issued by the Civil Administration. The distinction between these two categories has drawn criticism for discriminating against settlers in different types of settlements.

The arrangement between the state and the World Zionist Organization allows for less transparency and equitable resource distribution in building new settlements. The Settlement Division, funded by the Israeli government but administered by the World Zionist Organization, serves as the de facto executive branch for establishing new settlements, including those in the West Bank.

Finance Minister, Bezalel Smotrich at a cabinet meeting. Photo by: Reuters

Amana’s control over land allocation in the West Bamk  allows the company to maintain dominance in real estate development. Due to this control, Amana is a major player in the West Bank real estate market, thanks to its large land reserves yet to be sold.

As the situation lacks transparency, the exact amount of land allocated to Amana remains undisclosed. The World Zionist Organization is not obligated to publish figures regarding land allocation in the West Bank, having received an exemption from doing so in 2015.

Critics argue that the absence of transparency allows Amana to dictate property prices and allocate state-owned land as it sees fit. Developers and other companies have joined projects in World Zionist Organization settlements in recent years, indicating a shift from the automatic transfer of lands to Amana.

Despite the complexities surrounding the subsidy system, residents of these settlements, like Avihai Peretz from Avnei Hefetz, express dissatisfaction with the arrangement. Peretz, who bought an apartment in the settlement in 2012, feels that developers like Binyanei Bar Amana and the National Land Redemption Fund profit at the expense of the settlers.

In response to the criticism, the National Land Redemption Fund maintains that it operates in accordance with a government decision, charging settlers a management and handling fee but not for the land itself. The Fund insists that it does not receive land from the Settlement Division.

Evacuation Benefits: The Surprising Windfall for AmonaSettlers and its Potential Precedent

In February 2023, the Israeli government took a controversial step by legalizing nine previously illegal West Bank outposts, paving the way for their recognition as official settlements. This contentious move has resulted in strained relations between Jerusalem and the Biden Administration, along with widespread international condemnation. However, an examination of the past evacuation of the West Bank settlement, Amona, suggests that the residents of these newly legalized outposts might be in for a substantial financial gain.

Amona, the largest of the illegal outposts, underwent a complete evacuation in February 2017, following an extended legal battle led by human rights groups. The groups argued that the settlement had been built on privately owned Palestinian land. In response, Israel established the settlement of Amichai in 2018, marking the first government-approved settlement since 1992. The settlers of Amichai were granted land at nominal prices and without the need for a competitive bidding process. They paid a mere 16,000 to 19,000 shekels for plots of land ranging up to 1,000 square meters, and in some cases, even larger parcels of up to 1.3 dunams. Most of these land deals were finalized in 2019, with some completed in 2021.

To date, the Tax Authority’s website indicates that 36 deals have been completed, wherein residents of Amichai purchased plots of land from the state using this unconventional approach.

Therefore, after years of residing on land without payment, and after receiving tens of millions of shekels in compensation from the state during the Amona evacuation (including personal compensation of 4,800 shekels for each year of residency), the residents of Amichai received additional land free of charge, requiring only a 250,000-shekel development fee, similar to how moshavim, kibbutzim, or other communities within the Green Line expand their territories.

Avihai Boaron, a freshman Likud Knesset member and a leader among the Amona evacuees, explains that the Israel Land Authority determines the land’s price based on discounts offered in areas of national priority. What sets this case apart is the allocation of land without a competitive tender process, a privilege granted to the Amona evacuees due to exceptional circumstances.

If the Amichai precedent is applied to the nine recently legalized outposts that are expected to become settlements, it is reasonable to assume that each settler there will receive the same government benefit: an exemption from competitive bidding and access to significantly discounted land, simply because Judea and Samaria are designated as priority areas on the national map. Some of these legalized outposts are strategically situated near areas of high demand, such as Sde Boaz, which is in close proximity to Gush Etzion and a short drive from Jerusalem.


Shomrim spoke to a resident of one of these outposts, who asked to remain anonymous, and learned that the settlers are already getting ready for the new circumstances. “The land belongs to the people who live here,” he says. “We will divide the land up according to an internal map, so that the moment that there’s an ordered plan here, then there will be no disagreement of what it’s public areas, whether that’s a road or a public building.

This is a summary of shomrim's story published in Hebrew.
To read the full story click here.