Israel announced Tuesday it would soon issue tenders for 5,000 new units of housing nationwide, including about 570 apartments on land it seized during the 1967 Mideast war.

The government said the new housing was needed to address Israel's rising real estate prices, which triggered massive popular demonstrations this summer. But critics objected to the inclusion of 348 units in Har Homa and 18 in Pisgat Zeev, two Jewish developments in the Jerusalem area. An additional 213 units are planned for the West Bank settlement of Efrat.

In August, the government gave the green light to 900 new homes in Har Homa, which Palestinians warned was cutting off access between Arab neighborhoods in East Jerusalem and the West Bank city of Bethlehem.

Israel has rejected pleas from the U.S. and other countries to refrain from expanding settlements. Palestinians are refusing to return to peace talks until settlement construction is frozen.

Israeli officials defended their right to continue expanding in the Jerusalem area.

"Building in Jerusalem is Israel's policy and it will continue now and into the future,'' government spokesman Yoaz Hendel told Israel Radio.