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New report paints mixed picture for housing market

The housing market continued to boom in the second quarter as both the value and quantity of properties for sale increased, but whether the supply would be absorbed by the market has yet to be seen, a market report released yesterday said.

The report -- from Cathay Real Estate Development Co (國泰建設) and the Taiwan Real Estate Research Center at National Chengchi University -- showed that in the last quarter, 25,334 units worth NT$248.1 billion (US$7.56 billion) were put on sale, up from 19,663 units worth NT$214.8 billion in the first quarter.

Pushed by high-priced apartments and suites, the price of housing in Taipei City has continued to rise, increasing from NT$460,400 per ping (3.3m2) in the first quarter to NT$489,400 per ping in the second quarter, the report said.

But turnover rate dropped to 27.43 percent last quarter, compared to 30.14 percent in the first quarter, showing signs of cooling and oversupply, the report said.

"The development of the housing sector in Taipei will affect the market trend nationwide," the report said.

The cooling of the market because of rates hikes and the credit crunch for mortgages has slowed local realtors' expansion plans, Evertrust Rehouse Group (永慶房仲集團) said.

For the first half of the year, eight major local housing agents added a total of 252 new outlets, down 7.69 percent from a year go, according to data released yesterday by Evertrust, one of the nation's leading housing agencies.

These eight firms had a total of 1,919 branches as of the first half of this year, an increase of 14.29 percent over last year.

"We have seen a mild slowdown in the nation's sizzling housing market during the first half of this year because the central bank has continued to raise interest rates and lenders have tighten mortgages," Evertrust Rehouse's president Benson Liao (廖本勝) said.

Realtors have become conservative about their expansion plans, Liao said.

Nationwide, however, the property market is not cooling down. It remains busy in several areas, such as in Greater Taipei, where housing agencies will face even greater competition, Liao said.

The capital saw 79 new real estate branches in the first half of the year -- more than double the expansion pace in the same period last year. Taipei County saw 69 new branches, an increase of 9.52 percent, data showed.

Taipei City's Da-an District and Banciao, Taipei County, saw the biggest increase in new realtor offices, reflecting a potential based on well-designed infrastructure and convenient transportation, Evertrust Rehouse said.

Taipei's Zhongshan District is an increasingly popular housing market for wealthy people and it has attracted housing brokers seeking this market sector, the company said.

Kaohsiung City also has great potential as the city government focuses on completing its rapid transport system, a sports dome, and shopping malls, it said.
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