The nation's property market grew in the first quarter of this year, reversing six quarters of decline, according to a survey released yesterday by the Architecture and Building Research Institute under the Ministry of the Interior.
"The local real estate market seems to have [temporarily] bottomed out," Chang Chin-oh (張金鍔), professor of economics at National Chengchi University, said yesterday during a presentation to discuss the survey's results.
Chang said the property market expanded 1.22 percent in the first quarter from the previous quarter -- a result which he attributed to the government's preferential loan program.
"Fearing the Cabinet's NT$320 billion in preferential loans will run out, home buyers flooded the market in the first quarter," he said.
Chang added that growth slowed in April and May after another NT$20 billion in preferential loans were later announced.
According to property broker Sinyi Real Estate Inc (
"This is the first time we've seen any property market recovery in six years," said Victor Chang (
Sinyi's Chang also expressed optimism for the next six months, saying "low interest rates on savings and government home loans and [slight decreases] in home prices will attract more buyers."
But with 84 percent of the nation's adult population already owning their own home, National Chengchi University's Chang said there was little reason to be overly optimistic.
Chang noted that vacancy rates remain high, and buyers could choose to wait for expected auctions of real estate held as collateral by banks.
There are approximately 1.23 million vacant houses islandwide. As of December, more than 50 percent of the nation's NT$1.68 trillion in non-performing loans were collateralized with real estate, according to statistics from the Ministry of Finance.
"It'll be a slow yet stable upturn," the university professor said.
The institute's survey also found that land developers are hopeful that a recovery in the market is near, while construction companies are keeping a wait-and-see attitude.
City dwellers in central Taiwan are the most optimistic about a recovery in the real estate market, followed by those in northern Taiwan.
But in southern Taiwan and the Kaohsiung area specifically, buyers remain very pessimistic, according to the survey.
Chang said it was too early to tell whether housing prices will be greatly reduced after asset management companies start selling off their impaired assets.
"Impaired asset [prices] may not be competitive with other housing units in the market," he said.
Other signs of a recovering property market include the success the government has enjoyed in selling off assets. The National Property Bureau under the finance ministry said yesterday that the bureau has sold 36 percent of its auction offerings over the past five months, compared to 22 percent for the same time last year.
"Turnover totaled NT$6.8 billion, proving that the property market is gradually picking up," said Su Wei-chen (
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