Renting out — or renting — a high-value apartment in Ir Yamim, Agamim or on the first line to the sea near Nitza Boulevard is very different from a standard rental in an older building.
When the property is worth millions of shekels and the monthly rent is around 8,000–15,000+ ₪, a generic rental agreement is usually not enough to properly protect either side.
In 2026, against the background of a more stable real estate market in Netanya, demand for premium rental properties from overseas tenants and relocating families remains relatively steady. For owners, this means understanding the Israeli rental framework clearly — especially the financial and legal tools that help protect an expensive property.
Financial Guarantees in Premium Rental Agreements
In Israel, a property owner is legally allowed to request meaningful financial guarantees from the tenant, especially when the apartment is expensive, furnished, recently renovated or includes costly systems and finishes.
The purpose is to protect the owner in case of damage to the property, damage to furniture or equipment, unpaid rent, or a tenant leaving unexpectedly.
1. Bank Guarantee
A bank guarantee is one of the strongest protection tools available to a property owner in Israel. The tenant's bank freezes a certain amount in the tenant's account — often around 3 months' rent — and issues an official guarantee document in favor of the property owner.
If the tenant breaches the agreement, stops paying or disappears, the owner can approach the bank and receive the guaranteed amount according to the terms of the guarantee, without starting a lengthy court process.
For the tenant, this is a relatively expensive tool: the money is blocked and cannot be used, and the bank also charges a fee for issuing and maintaining the guarantee.
2. Security Promissory Note
A security promissory note is a legal document in which the tenant and usually two independent guarantors commit to paying a fixed amount in case of damage, debt or breach of contract. In most cases, the guarantors should have verifiable income in Israel.
If a problem arises, the owner may be able to submit the promissory note directly to the Israeli Execution Office, known in Hebrew as Hotza'a LaPoal, rather than going through all stages of a regular civil claim. This tool is especially important for furnished apartments, recently renovated apartments and properties with expensive systems or finishes.
3. Tenant Screening Through Specialized Services
In the premium segment, property owners increasingly use external tenant-screening services before signing a lease. These services can help verify financial background, credit history, open debts, enforcement files, returned checks and the general financial stability of the candidate. In the Israeli market, services such as Difference, BDI and other payment-risk assessment systems are commonly used for this purpose.
It is important to understand that even a thorough background check does not replace a bank guarantee, guarantors or a properly drafted rental agreement. These tools work together. Screening helps assess the tenant before signing; the legal and financial guarantees protect the owner after the tenant moves in.
Repair Responsibilities in a Rental Apartment
| Owner's responsibility | Tenant's responsibility |
|---|---|
| Major infrastructure systems: for example, a fault in the compressor of a built-in central air-conditioning system. | Damage caused by improper use: replacing broken glass, repairing a damaged faucet, or fixing a lock broken through negligence. |
| Hidden infrastructure: leaks or pipe bursts inside walls, replacement of a shared solar water heater that has stopped working. | Day-to-day use damage: scratches in parquet flooring, damage to furniture caused by pets, replacement of burned-out light bulbs. |
| Natural building wear: wall cracks caused by building movement, deterioration of external waterproofing on a balcony or roof. | Returning the apartment in proper condition at the end of the lease: cleaning, cosmetic repairs and repainting the walls to the condition in which the apartment was delivered, if this is required by the agreement. |
Renting out an expensive property to overseas tenants requires more than signing a lease. It also requires checking the tenant's payment ability and, where relevant, the financial strength of the guarantors.
Over 25 years in the Israeli real estate market, I have handled hundreds of successful transactions, most of them in Netanya. I know how to structure a premium rental agreement, how to protect renovation work and furniture with the right guarantees, and how to manage communication with service providers, the building committee and local authorities.
Planning to Rent Out a Premium Apartment in Netanya?
Call Inna✓ Advantages
- +Tenants with stronger payment capacity: premium tenants are often senior professionals, executives, relocating families or overseas residents who tend to be careful about meeting contractual obligations.
- +Longer lease potential: premium tenants move less frequently, especially when children are placed in schools in Netanya, creating potential for stable 2–3 year rental income.
- +Newer building systems: newer residential complexes usually have more modern infrastructure and require fewer routine repairs compared with older buildings.
✗ Disadvantages
- −Higher expectations from tenants: even a relatively small issue may require a quick response from the owner and the use of qualified professionals.
- −High carrying costs during vacancy: when the apartment is empty, arnona and building maintenance fees remain fully the owner's responsibility. In premium buildings with a concierge, gym or pool, these monthly costs can be significant.
Frequently Asked Questions
Who pays utility bills, arnona and ongoing charges when the apartment is rented?+
After the lease is signed and the keys are handed over, the tenant usually transfers the electricity account with the Israel Electric Corporation, the water account with Mei Netanya and the arnona account with the municipality into their name. Ongoing costs related to the tenant's use of the apartment are generally paid by the tenant. Major repairs to the building's shared property, such as replacing an elevator, usually remain the owner's responsibility.
How should an option to extend the lease be written?+
An extension option gives the tenant priority to extend the rental agreement for an additional year. The agreement should state clearly how far in advance the tenant must give written notice — in many agreements this is 60–90 days before the lease ends. It is also important to state whether the rent during the option period remains unchanged or increases. In Netanya in 2026, an increase of around 3–5% from the base rent is common in many premium rental agreements.
Can the owner enter the apartment to inspect its condition?+
Yes, but only by prior arrangement. A rental agreement usually states that the owner may visit the apartment after giving 24–48 hours' notice, and not more than once every 2–3 months. The agreement can also state that during the final month of the lease, the owner may show the property to potential buyers or future tenants, also by prior arrangement and at reasonable hours.
What happens if the tenant stops paying and refuses to leave?+
In Israel, a property owner is not allowed to remove a tenant by force. The legal route is to file a fast-track eviction claim for a rented property, expected to be heard within 60 days. If a security promissory note was prepared properly, the owner may also be able to pursue debt collection through the Execution Office, including legal steps against the tenant's accounts.
Have Questions About Renting Out or Managing a Property?
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