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Tel Aviv, Israel (AHN) – One day after an explosion in the pipeline at a gas terminal in the country’s northern Sinai Peninsula, Egyptian authorities have temporarily suspended gas supplies to Israel and Jordan – a move that prompts Israel to consider accelerating development of its own natural gas fields.

Israel is dependent on Egypt for 40 percent of its natural gas supply, the majority of which is used by country’s power stations.

The current gas deal is the foundation of the 32-year-old peace treaty, which is now at stake following the ongoing anti-government protests and civil unrest in Egypt.

If a government hostile to Israel comes to power, Israel fears renewed hostilities and a severing of business and diplomatic relations between the neighboring nations..

Speaking at a weekly cabinet meeting, Israeli Prime Minister Benjamin Netanyahu stressed the need to find alternative energy sources in the wake of scenarios that jolt the region.

Netanyahu also lauded Infrastructure Minister Uzi Landau’s efforts in seeking loans from government and tax breaks to accelerate the development of a natural gas field, which was found off Israel’s Mediterranean coast recently.

Cabinet minister Landau said that Israel must become energy independent.

“We always hope for the good, in terms of the peace agreement that we have and with the gas commercial contract that we have, but we always have to prepare ourselves for the bad case,” Landau added during the meeting.

Landau further explained his government’s plans to construct a floating platform off the Mediterranean coast to obtain LNG, which could be transported to shore.

“We must build this platform off Hadera in the next two years because there is an emergency that we need to take into account,” Landau told Israel Radio.

He added that it would easily to stockpile LNG for emergency situations compared to other forms of natural gas.

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On any given day, people can easily find articles and news stories describing an impending bust of the so-called real estate bubble. Despite this gloomy prediction, many experts believe that the recent slowdown in housing will be a gradual and modest readjustment rather than sharp bust or decline. These experts believe that factors that lead to a sharp decline in the real estate market are just not present in the current economic outlook. In fact, a recent study by the Joint Center for Housing Studies at Harvard University noted that “despite the current cool-down, the long-term outlook for housing is bright.”

The rise and fall of the real estate market is subject to the forces of supply and demand, and these factors point to stable and positive growth in the real estate segment.

SUPPLY FACTORS

Limited supply of real estate makes it scarce and usually pushes home prices up. In contrast, an oversupply of real estate tends to put downward pressure on home prices. Despite the current slow down in the real estate market, factors that impact limited supply favor continued growth in the real estate market. Some of these factors include:

1. Builders have readjusted growth plans in regions that have an oversupply of new housing. Over time, any excess inventory is likely to be depleted and equilibrium achieved between supply and demand.

2. The availability of land in certain regions, as well land use regulations and associated compliance costs will continue to restrict the supply of new homes.

DEMAND FACTORS:

Housing located in regions with high demand tend to be more expensive than homes in regions with low demand. Factors that impact the demand for housing suggests a favorable long-term housing outlook. Some of these factors include:

1. No current evidence of significant and across-the-board job losses; forecasts of relatively low unemployment rates.

2. Long-term increased demand for second homes, vacation homes and senior housing by baby boomers.

3. Long-term increased demand for entry-level homes by the children of baby boomers.

4. Long-term increased demand for entry-level homes by immigrants.

5. Long-term increased demand for entry-level homes by second-generation Americans.

6. Forecasts that the outflows and inflows of the U.S. population in and out different regions will not significantly impact the overall U.S. real estate housing market.

7. Relative stability in interest rates.

8. Continued stability in long-term home appreciation rates.

9. Overall, rising rate of wealth across all age groups.

SUMMARY

In summary, strong household growth, overall rising incomes and wealth, and a stable economy all bode well for continued long-term growth in the real estate market. While the overall housing outlook is favorable, affordability will continue to be a challenge, as wages, especially in the lower income levels, have not kept up with housing costs.