Tue, Nov 09, 2004 - Page 11 News List

House-price confidence low

By Joyce Huang  /  STAFF REPORTER

The nation's confidence index on property prices continued to decline to 111 points in the third quarter from the second quarter's 120 points and the first quarter's high of 131 points, a survey conducted by the Council for Econ-omic Planning and Development (CEPD, 經建會) found yesterday.

Expectations

"Compared to the first two quar-ters, some house buyers expect property prices to rise in the future, although the majority of respondents are still optimistic about the local property market," said James Ting (丁福致), deputy director of the Taiwan Institute for Real Estate Information, which was commissioned by the CEPD to conduct the quarterly survey and compile the index.

Over 45 percent of polled house buyers in the third quarter believe property prices are on the rise -- down from the second quarter's 49.8 percent, while only 4.4 percent believe the prices are on the wane, the survey showed.

Despite of the index's decline, pundits yesterday said that the local property market's recent fluctuation is healthy.

"As long as the index remains at around 100 points, an optimistic market sentiment is still foreseeable," Hua Ching-chun (花敬群), chair of Hsuan Chuang University's department of public affairs management, said yesterday at a press conference.

Hua said that the market sentiment is likely to turn around in the next quarter and return to normal next year when economic uncertainties and the legislative elections next month have been dealt with.

Decline

Expressing a similar view, Timothy Ma (馬玉山), chairman of Kindom Construction Corp (冠德建設), however, yesterday attributed the index's decline to political instability and the speculation of a possible interest-rate hike.

"Such political instability will not only delay house buyers' decisions, but also have a very negative impact on sales of luxury housing projects," Ma said at the same press conference.

Chairing yesterday's press conference, CEPD chairman Hu Sheng-cheng (胡勝正), however, said that he believes the rising interest rate has a limited impact on the property market since the rates are still low.

Upgrade

The survey also found that 45.9 percent of respondents are first-time house buyers and another 37.5 percent attempt to upgrade their living environment by moving to new homes of better quality.

A majority 52 percent of house buyers aim for second-hand houses and another 30 percent would like to buy a new house, while only 13 percent would be interested in pre-sale housing projects.

The majority, moreover, is looking for houses measuring between 21 pings and 40 pings and priced between NT$3 million and NT$9 million, an average six times their annual earnings, the survey showed.

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