Fri, Aug 22, 2003 - Page 10 News List

Luxury-housing auction could be a risky gamble

BARGAIN LUXURY DTZ Debenham Tie Leung will auction off 13 luxury town homes next month, but analysts are divided about whether or not the sale will succeed

By Joyce Huang  /  STAFF REPORTER

Thirteen luxury housing units in Taipei Garden Town Housing in southern Taipei's Mucha district will be auctioned next month, with floor prices ranging from NT$15.3 million to NT$23.5 million per unit, an international property dealer said yesterday.

"This auction of newly-built houses will be the first of its kind, and we aim to liquidate NT$250 million in total," said Chiu I-ping (邱奕平), an auction specialist at DTZ Debenham Tie Leung International Property Advisers (戴德梁行).

The real-estate broker has been successful in organizing auctions in the past, usually closing deals at a discount of 30 to 50 percent of the property's market value, to help banks liquidate collateral on non-performing loans.

According to Chiu, most housing units in the Taipei Gardens, which are 80 to 92 ping each in size, were previously sold at an average price of between NT$210,000 and NT$230,000 per ping.

But asking prices for the auction on Sept. 26 will start as low as NT$192,000 per ping.

"Would-be buyers may only see a 5 to 10 percent discount below market value, [depending on the final closing prices] since these properties are very high-quality houses," Chiu said.

DTZ Debenham Tie Leung is confident in its ability to auction off the 13 houses and is marketing its auction to owners of small and medium-size enterprises, white-collar professionals, public-health workers and government employees.

"These potential buyers typically care more about location and living conditions of a property than its price," Chiu said.

But market watchers yesterday said they are more reserved about the upcoming auction.

"It will be hard [for DTZ Debenham Tie Leung] to sell the units, since property prices in some of the nearby communities were once lowered to only NT$160,000 per ping [three years ago]," said Victor Chang (張欣民), associate manager of Sinyi Real Estate Inc (信義房屋). In addition, would-be buyers of luxury housing are not used to dealing with the brouhaha of an auction or haggling over prices, he added.

A developer of high-priced property, Tu Ming-yi (杜明毅), also said that difficulties may arise for DTZ Debenham Tie Leung to sell off any units priced around NT$20 million in Mucha, a non-commercial district.

But Huang Chi-cheng (黃志成), general manager of Bear International Advertisement Co (貝爾廣告), which specializes in property development, disagreed, saying town houses are popular among home shoppers.

He said that town-house prices in central and southern Taiwan are soaring to over NT$40 million per unit while the number of town-house buyers in Taipei is also on the rise.

Chang, however, said the nation's real-estate sector has begun improving recently.

"The number of real estate transactions will continue to increase in the next few months, while prices are unlikely to rise," he said.

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