The Israeli government on Sunday announced a series of measures to build 187,000 new apartments over the next five years, Israeli daily Maariv reported.
Around 40,000 apartments will be for affordable housing and the majority of the new buildings will be constructed in the Tel Aviv area, central Israel and Jerusalem, Maariv said.
The limit in rental assistance provided to residents in public housing will also be raised and property tax on uninhabited apartments will be doubled, a move expected to free around 15,000 apartments annually.
The measures are based on the recommendations of the Trajtenberg committee, which was set up after Israelis took to the streets last year to protest against the high cost of living.
It is unclear whether any of the apartments will be built in the West Bank and East Jerusalem.
Israel has occupied the West Bank, East Jerusalem and Gaza Strip since 1967