Investors bullish on property market

The nation's housing prices have recorded relatively smaller growth than other countries in the past eight years, but this is why foreign investors believe Taiwan's housing market still has room for price increases, according to a report released Sunday by Sinyi Realty Inc (信義房屋), a major realty broker.

Sinyi's housing price index, compiled together with West Virginia University, shows that the nation's housing prices in the second quarter of this year rose 2.31 percent over the same period of last year but made no significant growth compared with the first three months of this year. This is the eighth consecutive quarter in which housing prices have recorded a rise since the market reversed its downward trend in the third quarter of 2003.

According to the report, houses in Taipei County recorded the highest price growth of 4.36 percent, followed by those in Taichung City at 2.57 percent and Kaohsiung City at 1.7 percent. Taipei ranked fourth with a price growth of 1.53 percent.

Victor Chang (張欣民), an analyst of Sinyi Realty in charge of planning and research, pointed out that although the government continued to make NT$300 billion (US$9.5 billion) available for low-interest loans for housing in the April-June period, the June 12 flooding in southern Taiwan and continuous rain brought by typhoon Haitang all over the nation has dampened the housing market.

However, he said, foreign investors are still confident in the future of the housing market. Some executives have even predicted that when the three direct links -- trade, transportation and postal services -- between Taiwan and China become a reality, the nation's housing prices could rise by at least 50 percent.