Rental Agreement in Israel — The Complete Guide for Tenants and Landlords 2026

Mandatory Clauses — What Must Appear in Every Israeli Rental Agreement

Israeli residential leases are governed by the Rental and Loan Law (1971) and the 2017 Fair Rental Law amendment. The 2017 amendment introduced cogent provisions — clauses that cannot be modified to the detriment of the tenant, even in a signed contract. The Ministry of Justice also published standard contract regulations that serve as a default framework.

Every rental agreement must include: full identification of both parties and the property (address, block, parcel); the purpose of the rental (residential); exact lease dates (start and end); rent amount and payment method; conditions for renewal or termination; detailed security arrangements; division of repair responsibilities; terms regarding pets, renovations, and installations; and a property handover protocol.

Security Deposits and Guarantees — How Much Can a Landlord Demand?

The Fair Rental Law caps security deposits that involve a financial cost to the tenant — meaning cash deposits or bank guarantees — at the lesser of three months' rent or one-third of the lease period. For a standard 12-month lease, this effectively means three months' rent.

Guarantees that don't involve direct costs — promissory notes, open checks for municipal taxes and utilities, or personal guarantors — are not subject to this cap and can be for higher amounts.

In the Bik'at Ono market, the common practice is a one-month cash deposit plus a promissory note with guarantors. Full bank guarantees are rare for residential rentals and more common in commercial leases. For a typical Kiryat Ono apartment renting at NIS 7,000-8,000 per month, expect a deposit of NIS 7,000-8,000 plus open checks for municipal services.

Repair Responsibilities — What the Landlord Must Fix and What Falls on the Tenant

The Fair Rental Law establishes a clear, non-negotiable division: the landlord is responsible for all defects resulting from normal, reasonable use — except minor ones. This is a cogent provision that cannot be altered in the lease.

Timelines are equally clear: standard defects must be repaired within 30 days of notification. Urgent defects — water leaks, electrical failures, sewage problems — must be fixed within 3 days. If the landlord fails to act? The tenant may hire a professional, pay for the repair, and deduct reasonable costs from the rent.

Ongoing Payments — Who Pays What in a Rental Property

Not every property-related payment is the tenant's responsibility. The Fair Rental Law clearly distinguishes between costs that can and cannot be charged to tenants.

Tenant pays: monthly rent; property tax (arnona, registered in tenant's name); electricity, water, and gas; building maintenance fees (vaad bayit for cleaning, elevator, common areas); internet and communications. Landlord pays and cannot charge to tenant: building insurance (contents insurance is the tenant's choice); permanent property improvements (new elevator, facade renovation); landlord's brokerage commission; acquisition or betterment taxes.

An important note: even if the landlord includes a clause requiring the tenant to pay building insurance — that clause is void under the cogent provisions of the law. In the Bik'at Ono area, vaad bayit fees range from NIS 150-400 per month, with newer buildings typically charging more due to expanded common areas, elevators, and designed lobbies.

Terminating a Lease — Early Exit, Renewal, and Property Sales

The Fair Rental Law regulates lease termination for both parties. Tenants can unilaterally cancel a lease — not due to landlord breach — by providing 60 days' written notice. This right exists even if the contract doesn't grant a matching right to the landlord. In practice, most contracts include an exit clause requiring the tenant to find an acceptable replacement tenant.

Landlords can only terminate unilaterally if the contract grants them a reciprocal right, and they must provide 90 days' notice. For fundamental breaches (non-payment of rent), the landlord can demand correction within 7 days and then terminate.

If the landlord sells the property, the lease obligations transfer to the buyer. The tenant continues to live in the apartment until the lease expires under the same terms. The landlord must notify the tenant in advance of the sale.

Renewal and option clauses: the standard practice in Israel is for the tenant to notify the landlord 45-60 days before the lease expires. The landlord may adjust the rent, but increases of 10% or more require 3 months' notice. Importantly, there is no legal cap on rent increases upon renewal in the free market — except for apartments owned by large corporations (25+ units), where the cap is 5% per year.

Local Market Insights — Renting in Bik'at Ono (Kiryat Ono, Ganei Tikva, Yehud, Or Yehuda)

Beyond the legal framework, the Bik'at Ono rental market operates with local customs worth knowing. Average monthly rent for a 3-bedroom apartment in Kiryat Ono runs NIS 5,500-6,500, a 4-bedroom NIS 7,000-8,000, and a 5-bedroom NIS 8,000-9,000. Ganei Tikva prices are similar with a slight premium for private houses and garden apartments. Yehud and Or Yehuda are 10-15% lower.

Standard lease duration is 12 months plus a 12-month option. In new developments (Umami, Aura HaOren), shorter initial leases may be offered during the first occupancy phase.

A critical note for older buildings: in neighborhoods like Kiryat Ono Vatika, Ganei Ilan, and Reisfeld, check if the building is slated for TAMA 38 or pinui-binui urban renewal. Advanced projects can affect or shorten your lease period. Ask the landlord directly and verify with the municipality.

Contact Shmuel if you need help understanding the local rental market or have questions about a specific contract. Local knowledge makes the difference.