Who Qualifies as 'Elderly' Under the Pinuy-Binuy Law?
The legal definition is precise and often surprises residents. An 'elderly' resident (kashish) is someone who turned 70 on the day the first tenant in the building signed the pinuy-binuy agreement — not necessarily when you personally sign. This means if your neighbor was the first to sign in January 2025 and you were 70 at that point, you are legally 'elderly' even if you personally signed a year later.
An additional requirement is at least two years of residency in the apartment before that first signature date. Regarding spouses: if one spouse qualifies as elderly, the Haifa District Court (March 2024) ruled that protection should be examined for the younger spouse as well. If a resident is legally incapacitated, their guardian represents them and all rights apply in full.
- Age 70 is determined on the day of the first agreement signing in the building — not your personal signing date
- A minimum of 2 years residency before the first signing date is required
- A spouse of an elderly resident may benefit from similar protection even if under 70
- Nursing care recipients or terminally ill residents receive the same rights as those aged 75+, regardless of biological age
What You're Entitled To: The Three Alternatives the Developer Must Offer
The law requires the developer to offer elderly residents aged 70–74 at least one of the following alternatives before demanding their signature. For those aged 75+, a full replacement apartment is due in addition to one of these alternatives. Offering just one option is insufficient — the developer must provide information on all options and allow the resident to choose.
Critically: if the developer fails to offer the legally required alternatives before the signing, the elderly resident's refusal to sign is considered 'reasonable refusal' rather than being labeled a 'blocking tenant' (dayer saravyan), meaning they cannot be sued to compel their signature. This is one of the most powerful legal protections available.
- Alternative A – Nursing home + equalization payment: The developer funds dignified nursing home accommodation for the entire construction period, plus a cash payment to equalize the difference versus the new apartment
- Alternative B – Two apartments: Receiving two smaller apartments instead of one larger one, allowing the resident to live in one and rent out or transfer the second to a family member
- Alternative C – Smaller apartment + cash: A replacement apartment of smaller size plus a cash payment compensating for the difference — ideal for elderly residents who prefer financial liquidity
- For those aged 75+: all of the above in addition to a full replacement apartment — not instead of it
Rental Assistance, Tax Benefits, and Additional Protections
During the construction period, all residents — including the elderly — are entitled to alternative rental payments from the developer. Elderly residents have priority placement and are not obligated to live in standard rental housing if they have requested a special solution such as a nursing home. The developer bears the cost of moving, and in the case of nursing care residents, also covers special adaptations.
On tax exemptions: there is an exemption from capital gains tax (mas shevah) and purchase tax for elderly residents participating in pinuy-binuy for the additional apartment entitled to them by law. These exemptions were extended through December 31, 2033 under the expanded affordability housing reforms. Always consult a real estate attorney about applicability to your specific case.
- Alternative rental: Full and reasonable rental payments throughout the entire construction period, located near your current area of residence
- Moving and storage: The developer funds furniture removal and return
- Capital gains tax and purchase tax exemption on the additional apartment — valid through end of 2033
- Nursing/terminally ill residents: entitled to a fully developer-funded nursing home solution
What Happens If the Elderly Resident Passes Away Before Project Completion?
A question many are afraid to ask, but it is critical. The Deputy Attorney General's opinion clearly established: the special rights granted to an elderly resident in a pinuy-binuy project transfer to their heirs. This means if you signed the agreement as an elderly resident and are entitled to an additional apartment, that apartment will be transferred to your heirs even if you pass away before it is built.
However, it is essential that the rights be properly documented in the pinuy-binuy agreement itself. An attorney representing the residents (not the developer) must ensure that inheritance clauses are explicit in the agreement. Do not rely on verbal agreements — everything must be in writing.
- Elderly residents' pinuy-binuy rights transfer to legal heirs per the Deputy Attorney General's opinion
- Rights, including any additional apartment entitlement, must be explicitly documented in the agreement
- It is advisable to update your will to explicitly reference pinuy-binuy rights
- Heirs can exercise the rights in place of the deceased elderly resident — there is no automatic forfeiture