Leasehold vs. Ownership in Israel
A Simple Guide for Overseas Buyers

RMI stands for the Israel Land Authority (in Hebrew, Rashut Mekarkei Yisrael). Think of RMI as the landlord: a large share of the land in Israel is owned by the state, and RMI is the government body that manages that land and leases much of it out to individuals and companies. If you have ever heard someone call it "the Minhal," that is simply the older name for the same organization — it was renamed in 2013, but the old nickname stuck.

The Tabu is Israel's Land Registry (in Hebrew, Lishkat Rishum Mekarkein) — the official public record of who holds what right in a given property. The word "Tabu" comes from the Ottoman-era Turkish word for a land registration document, and it has stuck as the everyday term Israelis use for the registry.

Here is the key point: the Tabu records both full ownership and long-term leases. A lease that started as an agreement with RMI can be, and in many cases should be, registered at the Tabu itself, as a registered long-term lease. It is not registered "instead of" the Tabu — it is recorded inside the Tabu, alongside all the fully-owned properties. RMI creates and manages the underlying lease; the Tabu publishes and confirms it. They are not two separate systems you have to choose between — they are two steps in the same picture.

Once you understand that RMI and the Tabu work together rather than against each other, the actual property rights break down into two basic categories:

• ◆
  Full ownership (in Hebrew, baalut) — the strongest right that exists in a property. The land is privately owned and registered as such at the Tabu. The owner holds the property outright, with no time limit and no dependence on an outside body.
• ◆
  Leasehold (in Hebrew, chakhira) — a long-term right to use land that belongs to someone else — usually the state, through RMI — for a fixed period, under a lease agreement. Israeli leases are typically set for very long periods, sometimes with options to extend. When the term is long enough, this is a genuine, registrable property right under Israeli law, not just a long rental.

A large share of the land in Israel is public or state land managed by RMI, so leasehold arrangements are common — many buyers, builders, and even renters end up dealing with a lease relationship at some point, sometimes without fully realizing it, for example when buying through a housing company or a cooperative association.

If RMI and the Tabu work together, and a long lease is a genuine registrable right, why does the distinction matter at all? Because a few practical differences can come up, depending on the specifics of the lease:

• ✓Financing and mortgages — arrangements with banks can be more involved for a property whose lease is not registered at the Tabu, or not capitalized (see below), compared with a straightforward, fully owned, registered property.
• ✓Selling and transferring rights — if a lease is not registered as an independent right at the Tabu, or has not been capitalized, extra steps with RMI can be required when the property is sold, compared with a registered, fully owned property, where the transfer is generally more straightforward.
• ✓Ownership of the land itself — even when a lease has been fully capitalized (see below), the land legally remains state property. This is a real conceptual difference worth understanding, even in the many cases where it makes little practical difference to how you use and enjoy the property day to day.

A quick note on "capitalized" leases, since the term comes up constantly: capitalizing a lease (in Hebrew, hivun) means paying, up front, an amount that covers most or all of the future payments that would otherwise be owed to RMI over the lease term. A capitalized lease usually means no more ongoing lease payments and a right that functions very close to full ownership in everyday life. It is important to be clear, though: capitalizing a lease is not the same as converting it into full ownership. The land itself still legally belongs to the state — capitalizing simply prepays the lease, it does not change who owns the underlying land.

None of this means leasehold is somehow "less safe" as a general rule. It simply means the specific terms of the right in the property you are considering are worth checking carefully, rather than assuming.

The simplest, most direct way to find out whether a specific property is fully owned or leasehold — and, if it is leasehold, whether the lease is registered and capitalized — is to request a Land Registry extract (Nesach Tabu) for the property. This official document states exactly who is registered as holding the right, and what type of right it is.

If the extract shows a lease, the next step is to understand its specific terms: is it capitalized (prepaid) or not, how much time remains on the term, and is it already registered at the Tabu as an independent right, or still at an earlier stage of the registration process. These are all details worth clarifying before you sign anything, not after.

Because this system — the split roles of RMI and the Tabu, capitalized versus uncapitalized leases, and how all of it is actually recorded — is typically unfamiliar to buyers coming from abroad, it is strongly recommended to work with independent local legal counsel who can pull the relevant records, explain exactly what right applies to your specific property, and flag anything that needs attention before you commit.