Israel suffered from a severe housing shortage at its creation. Despite an extensive national building program and the initial allocation of some abandoned Arab dwellings to newcomers, in early 1958, nearly 100,000 immigrants were still housed in transit camps. By the mid-1960s, however, the extreme housing shortage had been overcome and newcomers were immediately moved into permanent residences. From 1960 to 1985, a total of 943,350 housing units were constructed. In 1986, 94% of all housing units had piped water, 58.2% had flush toilets, and 99% had electric lighting. Between 1990–2001, a surge of immigration from the former Soviet Union and Ethiopia resulted in a dramatic increase in housing demand. The government responded with mortgage packages making it possible for new immigrants to afford housing.
As of the 1995 census, there were about 1,639,410 residetial dwellings throughout the nation. In 1996, about 38,000 new dwellings were added. Homelessness and overcrowding are serious problems in the West Bank and Gaza/Palestinan settlement areas.