 You could be forgiven for not remembering that Jerusalem is actually one of the oldest continuously inhabited cities in the world. Humans have been inhabiting this plateau on the edge of the Judean desert since approximately 4000 BCE. And from its humble origins near today's old city, the physical contours of Jerusalem have spread out and changed over time. All around today's city, the national bird of Israel dominates today's skyline, and that's a lame joke for the construction crane. So now you have a bad joke about Israel to use the next time you're throwing a dinner party. Construction is taking place rapidly throughout the city, and it comes in many shapes and sizes. On the one hand, Jerusalem is investing heavily in its transport infrastructure. Two new lines for the light rail system are currently being put down, and there are two more stops planned to be developed for the national train line to Tel Aviv. On the other, high-rise housing is going up throughout the city centre and beyond. You might think that looking at things from a Jewish Zionist perspective at least, building in Jerusalem would be pretty uncontroversial. I mean, Jews pray three times a day for a Jerusalem to be rebuilt, so what's not to like about new buildings going up? So here's an opportunity to throw in another tri-joke, which is that if you put two Jews together in a room, you're going to wind up with three different opinions. The current wave of construction in Jerusalem is divisive even among strong supporters of the city, and there are two main reasons for that. The first is that some people don't think that high-rise buildings belong in the city full stop. Jerusalem's current city centre is clustered around Ben Yehuda Street, and it contains mostly modestly tall buildings of about three to six stories. Despite Jerusalem being Israel's capital and despite it holding almost one million residents, Jerusalem doesn't really have a high-rise district per se. Compared to modern Tel Aviv, Jerusalem actually looks kind of pokey. For many veteran Jerusalemites, this low-key form of urban development and the quintessential mandated use of Jerusalem's stone is all part of what makes the city unique, and they really don't want to see it becoming a city like Tel Aviv with lots of skyscrapers. Other people like me think that skyscrapers are pretty amazing and that housing, however, comes to be welcomed. More serious argument, however, is being made about the nature of the buildings being developed, and this is really where things get kind of divisive. Take a look at some of these clips that I shot around Jerusalem. You'll notice that the buildings are pretty tall, stretching a couple of dozen stories and more above the ground level, but at only 7pm there really aren't all that many lights on. So why does Jerusalem seem to have so many ghost buildings? The reasons have to do with who's inhabiting these new tower developments, or more specifically who can afford to live there. Many charts of the housing stock going up all around Jerusalem currently is almost exclusively luxury housing, and that the only people who can afford to buy usage properties are, well, those who are fantastically wealthy. The real dissonance here is that Jerusalem isn't a city that's renowned for its wealth. In fact, that's really not Jerusalem's socioeconomic standing. Jerusalem's employment scene lags badly behind that of Tel Aviv and the Merkaz, which is the comparatively prosperous central plain of Israel. In fact, Jerusalem has been consistently ranked to be the poorest city in Israel with an unusually high rate of poverty. It's difficult to tell as the projects are being built who's moving into them and going to move into them. But we have some retrospective statistics that tell a pretty interesting story and offer some clues. Research carried out by Yair Asaf Shapira and colleagues at the Jerusalem Institute for Policy Research or the JIPR looked at the rates of non-residential Arnaudah in Israeli cities. Arnaudah is a municipal tax paid on properties in Israel. With the caveat that it's derived from 2018, which at this point is five years ago, it tells I think a rather interesting story. We see that throughout major cities in Israel, non-residential Arnaudah constitutes a sizable chunk of the money flowing into cities' coffers through taxes. And in fact, in only four of the city's surveyed, Rehuvot, Quarsaba, Netanya, and Batiam, the non-residential Arnaudah was less than the residential one. At a ratio of 1.09, Jerusalem sits at the lower end of the tier of cities where the inverse situation is the case and the municipal taxes that the city derives from non-residents exceed that paid by local residents. Tel Aviv, by the way, is a leader at a whopping ratio of 2.64. All that's to say that, if these trends have continued, the majority of property in Jerusalem is owned, at least on paper, by those who don't live in the country. Given the sizable nature of the non-residential income, it's reasonable to assume that urban legends are correct and that a large chunk of the developments currently going up in Jerusalem are intended for sale to the international market. Many of those buyers will inhabit their apartments only for a few weeks out of the year, typically around the Jewish holidays or the hageem, or they'll use them as investment property, perhaps renting them out to locals who have made aliyah. And it's the second of these possibilities that really tends to make people do a double-take. Okay, maybe just me. If Israel is supposed to be the Jewish homeland, can we really justify a situation in which wealthy diaspora Jews are profiteering from locals who can only afford to rent their properties? To me, this seems like a pretty big red flag indicating that Zionism has kind of gone off kilter year. However, judging by the state of the rental market here in Jerusalem, this really does seem to be the reality we wound up in. For this reason, and perhaps also less emotive ones, there have been calls to increase the supply of affordable housing in Jerusalem, so that locals can actually benefit from all the high-rise development that's going up all around them. So far, however, government initiatives to provide more affordable housing for first-time buyers really haven't cut the mustard. Lottery schemes offering discounted mortgages have tended to focus on stimulating buying in the economically deprived periphery of Israel in order to encourage development and settlement there. So, for an increasing number of young Israelis, Jerusalem simply remains unaffordable. This fact is reflected in other data from the JIPR which shows a net outflow of population from Jerusalem. Kavya 2 is that this picture tends to change from year to year. Part of this outflow is likely young people moving to Tel Aviv in search of better economic opportunity, but another part of it is likely due to those moving to cheaper localities within commuting distance of Jerusalem, places like Modin, Bechemish, Suhar Daza. So what's the take home message here? Saying this with statistical precision is difficult, but Jerusalem appears to have a growing, luxury housing bubble typified by high-rise developments marketed to people who have no intention of actually living here. Waves to change this situation have been discussed and include instituting a more punitive tax regime on non-residents. But as a relatively poor municipality that needs all the money it can get, Jerusalem also has a vested interest in simply letting the luxury housing bubble continue to mushroom. Nobody knows where the current situation is going to lead us, but one group of people being shortchanged by the situation, at least I think so, are the current residents of Jerusalem. In the upcoming municipal elections, we have a chance to make our voices heard to ensure that we don't end up living in a city we can't afford being increasingly built for people who don't actually live here. Want to get more videos from me? Then please consider liking this video and subscribing to this YouTube channel.