Israel acts to avoid housing crisis


The Bank of Israel has announced new rules which attempt to stem what it suspects is a property bubble.

The rules, which came into force on Thursday, limit the part of a housing loan  issued at a variable rate of interest to one third of the total loan. The limit applies on new variable-interest-rate housing loans where the interest rate is likely to change in a period of less than five years.

The central bank is concerned that borrowers' overreliance on variable rates risks sparking a wave of

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