Jerusalem is known for religious fervour, competing national claims and, most recently, a concrete separation barrier, visible from city centre hilltops, that snakes around Palestinian neighbourhoods.
But in certain areas the city seems sanguine, benefiting from a buoyant Israeli economy and booming real estate market that even last summer’s war against Hizbollah failed to significantly disrupt.
Much of the demand is for properties in upmarket locales such as the German Colony and Rehavia. But, as affordable apartments and houses become scarce, those with a more adventurous spirit are turning to the “trendy slum” of Nahlaot in the west of the city.
One of the oldest quarters outside the historic centre, it is characterised by 100 square metre plots of land occupied by one or two-storey stone houses with domed, Ottoman-style roofs, originally built for the city’s Jewish poor in the late 19th century. Jews from countries such as Yemen, Syria, Kurdistan and Turkey have long made the area their home but in recent years they have been joined by students, young couples and immigrants from the US and Britain. The Jerusalem Post has described the newcomers as “the funky set: art students from all over the country, bohemians from baby boomer families ready to settle down after their India explorations and young, religious American hippie types”. As a result, the Ladino language, or Judeo-Spanish, once spoken on Nahlaot’s streets has been replaced by Hebrew and English.
“Maybe this isn’t for everyone but I love the individuality, the quiet streets with no cars and village-like atmosphere,” says Ruth Yeschua, a real estate agent who lives in the area.
The mix of Nahlaot’s current population has created some tension between the yuppies and older residents, many of whom cling to their rent-controlled homes, and between the religious and secular. “I remember one German Jew asking me if there was a synagogue nearby,” says a Nahlaot resident. “I told him in this lane there are at least five synagogues: Yemenite, Syrian, Bretslav, Kurdish, Turkish. But he told me he was looking for something Jewish!”
One of the best-known synagogues is called Ades, built more than 100 years ago by Jews from Aleppo in Syria. It is renowned for Mizrahi hazanut, Oriental liturgical singing, and the building features on walking tours of the area.
Nahlaot (which means “inheritance”, “property” or “estate” in Hebrew) is close to the frenetic Mahane Yehuda shuk, or market, and the Bezalel art college. But away from the thoroughfares it is a much older Jerusalem. Pedestrian alleyways intersect tree-shaded squares, where groups of old men sit to play cards and escape the fierce summer sun. Stone walls are covered with posters advertising religious services or remembering the recently deceased, while others promote the sale of organic bread and various delicacies, all prepared locally.
Yeschua says the area was once slated for demolition but protesters persuaded the municipality to change its plans. Eventually, in the 1980s, residents started to benefit from new zoning laws and updated infrastructure, including new pavements, electricity and sewage facilities. “It’s not perfect – you can still see telephone and electricity lines hanging down the buildings – but I’m sure there’ll be a second round,” she says.
There was more optimism after the Oslo peace accords, which helped to lift the Israeli economy in the early 1990s. But the assassination of Yitzhak Rabin, the prime minister, by a right-wing Israeli in 1994 abruptly ended Jerusalem’s real estate boom. Prices fell by about 10-15 per cent city-wide though in Nahlaot the market simply stalled, says Yeschua.
Recession came after the start of the Palestinian intifada, or uprising, in 2000, and this conflict is still simmering under the surface. The Palestinians claim the eastern half of the city for their future capital but it was annexed by Israel after the 1967 war in a move not recognised internationally. Still, as violence in Israel declined and the government’s free market reforms kicked in, the economy picked up and is now on course to grow about 5 per cent in 2007 for the fourth straight year. And Jerusalem’s neighbourhoods have benefited.
Nahlaot real estate prices have risen in some cases by as much as 30 per cent over the past couple of years, helped by demand for traditional old buildings protected by preservation laws and even higher prices in more established neighbourhoods, which has pushed househunters to widen their searches.
Two years ago homes in the area sold for $2,000 per sq m. (Israeli property prices are typically quoted in the US currency.) Now they can reach $5,000 per sq m and some very optimistic agents hope to hit the $8,000 per sq m mark over the next year or so.
Many private buyers and developers choose to demolish the interiors of old homes, preserving only the stone façades. They then build up, adding sometimes four or five storeys to create either apartments or narrow town houses. Yeschua bought her first-floor apartment in 1998 for $240,000, then spent about $150,000 on renovation and the addition of another floor with two bedrooms and a library. She estimates that the resulting property, with its cool stone floors and book-lined walls, is worth about $600,000.
“I know of one family who bought the house next door to theirs, which was already developed, for $1m and they are thinking of making the two properties into one,” she says. “The fashion for studio apartments is dying away.”
Ran Binya, an agent with Tafnit Real Estate whose grandparents used to live in Nahlaot with their six children in one small apartment in the 1950s, says that knock-downs are common in the streets across the main Bezalel Road and closer to the art college, an area increasingly popular with young couples because it is more accessible to cars. One developer bought two old houses for $400,000 in the late 1980s, demolished them and built a block with six flats, now worth up to $400,000 each, in spite of the fact that they sit next to old tin-roofed houses traditionally occupied by the poor. On Madreigot Street another developer knocked down some historic steps to open access for cars and nearby old shops have been destroyed to make way for a five-storey apartment block.
Not everyone is happy with these changes. On a hot Sunday in early August residents gathered to protest the latter project, while a television crew from Israeli Channel 2 filmed the proceedings. A leaflet pointed to what the residents called vandalism. “Instead of putting in another complaint of how another place in Nahlaot is being torn down in front of our eyes, we have a great opportunity to show the decision-makers in the municipality our deteriorating situation,” it said. “This is our duty to the neighbourhood, which we love. No one will save it but us.”
Yanai Shpitzer, one of the protesters, accused the municipality of turning a blind eye when developers failed to get proper permission and licences. (In contrast, Palestinian homes without planning permission in east Jerusalem are regularly demolished.)
The Nahlaot resident who did not want to be named for fear of losing his rent-controlled home also worries about the fast pace of development. Further down his street some houses have been torn down to make way for a four-storey block to house students from a nearby yeshiva, or Jewish religious school. “These ‘students’ are usually young American guys sent to Jerusalem for a summer and end up drinking, entertaining women and making a lot of noise,” he says. “Other developers are building up to six-storey blocks on 100 sq m plots of land and you can’t sustain reasonable living with that level of density.”
Nahlaot is more protected than coastal areas near cities such as Tel Aviv and Netanya, where property companies and brokers are aggressively chasing foreign investment, particularly from US and French buyers. But as the Israeli real estate boom continues, even in conflicted Jerusalem, residents in the city’s latest hot spot are eager to make sure that their way of life is not irrevocably changed.
Tafnit Real Estate, +972 2-567 0506; www.tafnit.net
Ruth Yeschua, +972 2 624 4774; syeschua@gmail.com
