The rosy outlook for the nation's real estate sector may persist for the next few years and consumers wanting to buy property should act before prices rise, an industry executive said yesterday.
"The result of the March presidential election will not have a negative impact on Taiwan's real estate market, as people are now familiar with the Taiwanese campaign style," said Lai Cheng-i (
"In addition, the cost of building new houses is expected to increase 20 percent this year because of the soaring prices of raw materials including steel, sand and stone as well as tiles," Lai said.
The real estate sector produced a total of NT$230.5 billion-worth of new houses last year, a 26.9 percent rise from 2002 and a 148.6 percent increase from 2001, the federation said.
The top five locations for new housing units were: Taipei County with NT$50.5 billion worth of new houses; Taichung City (NT$40.5 billion); Hsinchu City and County (NT$29.6 billion); Taoyuan County (NT$24.6 billion) and Kaohsiung County (NT$22.1 billion).
"No matter who wins the presidential election, the market boom is expected to last this year with growth of up to 20 percent, which may exceed NT$300 billion," Lai said.
The federation predicts the unit price of real estate in Taipei City to recover to the previous level of NT$400,000 to NT$500,000 per ping, while prices in other places could rise to an average of NT$160,000 per ping this year.
Lai attributed the market boom to the encouraging performance of the local bourse and a strong New Taiwan dollar against the US dollar. Low bank interest rates, the one-year extension of a 50-percent cut in the land-value increment tax and abundant capital flowing into the market were also cited as helping the sector recover, he added.
The main real estate products selling this year will be high-priced units aimed at people who want to change houses and lower priced ones targeting first-time buyers.
"We estimate that China's economy will keep growing until 2010, drawing the world's hot money to Asia with Taiwan remaining the favorite destination," Lai said. "So Taiwan's real estate could continue the boom for the next seven years."
Taichung is likely to be at the center of this recovery, benefiting from the Central Science Industrial Park (中部科學園區) and other public constructions such as the Guggenheim museum.
"In view of Taichung's capacity for future development, we would invest up to NT$3 billion through build-operate-transfer projects to construct a 9,000-ping complex consisting of an exhibition hall and shopping mall," said Lai, who is also chairman of Shining Group (
"The complex, scheduled to be competed in two years, is located in Taichung City's seventh re-planning area, close to the construction site of Taichung City Hall and The Guggenheim Museum," he added.
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