Jerusalem Arabs who own land in the city are forbidden by their leaders to sell it to Jews or Jewish interests. If I were Bibi, when someone committed a terrorist act I wouldn't stop at destroying the house, I'd auction the land on which it had been situated to Israelis. That would add a major disincentive to someone who is thinking about stabbing innocent Jews.
http://www.jewishpress.com/news/breaking-news/israel-demolishes-2-terrorists-homes-in-jerusalem/2016/01/04/