Israel will build 884 houses in east Jerusalem, the housing ministry said Sunday. "After the weekly cabinet session (Sunday) we will tender bids for the construction of 121 housing units in Har Homa and 763 others in Pisgat Zeev," ministry spokesman Eran Sidis said. The two neighborhoods lie in mostly Arab east Jerusalem, which Israel occupied in the 1967 war. Palestinians slammed the decision, saying it undermined peace talks. "We strongly condemn this decision, which is a continuation of similar decisions to expand settlements that have never stopped," Palestinian senior negotiator Saeb Erakat said. "This decision will affect all the efforts to continue the peace process. The situation is very difficult," he added. "For sure we will be raising this issue, and the settlements are always the main issue in our negotiations with the Israeli side," Erakat said.