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Real estate sector hit by slower rise in home loans

The central bank's latest monthly data on home loans showed a slower increase last month, reflecting the constrained purchasing power of home buyers despite the government's favorable new policies in the property sector.

The amount borrowed rose NT$15.06 billion (US$466 million) month-on-month to NT$4.58 trillion last month, after growing by NT$21.22 billion in September and NT$21.67 billion in August, the central bank's figures showed yesterday.

Loans for home repairs also saw a contraction of NT$1.76 billion to NT$843.2 billion last month, compared with an increase of NT$430 million in September and NT$1.55 billion in August, the data showed.

The central bank's mortgage data came a day after a poll that showed home buyers were more bearish about prospects in the local housing market in the third quarter.

On Tuesday, the Institute for Physical Planning and Information said that home buyers' confidence in prices had declined to its lowest level since the second quarter of 2003 when SARS hit the nation.

Loans to construction companies and for land development rose NT$2.65 billion to NT$987.37 billion last month, the central bank's data showed.

The increase was higher than the NT$1.68 billion increase in September but lower than the rise of NT$23.39 billion in August, the data showed.
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