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New status set to boost property prices

The real estate market in Taipei County is enjoying a boom, as the nation's largest administrative division is soon to be elevated to the status of a special municipality, placing it under the direct jurisdiction of the central government.

"With the increased resources to improve infrastructure, many people will be willing to buy houses or invest in the housing market in Taipei County," Su Chi-jung (蘇啟榮), director at Sinyi Real Estate Inc (信義房屋), the nation's largest housing agency, said yesterday.

The legislature yesterday passed amendments to the Local Government Act (地方制度法), which stipulates counties with populations of more than 2 million qualify to become special municipalities. Taipei County currently has a population of more than 3.7 million.

With special municipality status, Taipei County's tax income is expected to double from NT$80 billion (US$2.4 billion) to NT$160 billion, and the county government is allowed to increase its staff numbers to improve services.

With the increased budget, ongoing or planned major public construction projects may be completed ahead of schedule, which will push up housing prices around the area, Su said.

Major projects in the county include the "New Banciao (板橋) Special Zone," where the county government plans to upgrade Banciao into a modern city with high-class residential property and large entertainment and commercial facilities.

On Thursday, 12 company executives and Taipei County Commissioner Chou Hsi-wei (周錫瑋) jointly unveiled the "Super HOPSCA" plan, with hotels, a high-density transportation system, offices, odeums, parks, parking lots, shopping malls, skywalks and a super dome, conference and convention centers, apartment and administration centers -- all to be built within the zone.

With a total investment of more than NT$50 billion by the 12 companies, the plan is expected to create an output value of NT$119.2 billion when completed in 2013.

Other major projects earmarked for the county include developing Sinjhuang (新莊) into the county's second administrative center and construction of the MRT to connect more of the county to Taipei City.

Housing prices in Banciao, Sinjhuang and Sindian (新店), and places further afield such as Linkou (林口) and Sanxia (三峽) are likely to rise closer to the rates in Taipei City, Su said.

Currently, standard apartments in buildings with an elevator in Taipei City cost between NT$400,000 and NT$500,000 per ping, while prices for the same type of apartments in Taipei County are NT$220,000 to NT$280,000 per ping, Su said.

But Chou's bid to make Banciao surpass Taipei's Xinyi District as a business center may be hard to achieve, as large or medium-sized companies still hold Grade A office space as their priority.

"We don't think the special municipality status will attract companies into moving their offices out of the city," said Jeff Lee (李誠慶), a manager at CB Richard Ellis Taiwan Ltd.

Prices of wholesale and retail commercial properties in Taipei County may rise after shopping malls and entertainment facilities open there, but the rise in the prices of office buildings will be limited, Lee said.

In the past year, companies either moved from Taipei City's Dunhua and Minsheng area to the Xinyi District, or to Neihu and Nangang because of the cluster effect of high-tech companies, Lee said.

Boosted by the upgrade, the construction sub-index rose by 9.9 percent yesterday. Companies with properties in Taipei County such as Formosan Rubber Inc (厚生橡膠), Far Eastern Textile (遠東紡織) and Kolin Inc (歌林) jumped by the 7 percent daily limit to NT$22.55, NT$32.35 and NT$9.77 respectively.
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