Can I withhold payment or deduct repair costs from the purchase price in Israel?

You cannot unilaterally withhold part of the purchase price because you have discovered defects — doing so would put you in breach of contract. The correct route is to pay the outstanding balance, document defects, notify the developer in writing, and pursue a separate claim for repair or compensation. If defects are so severe that they prevent normal use of the apartment, an Israeli attorney can advise on whether a court-ordered set-off is available in your specific circumstances.