Wed, Jul 08, 2009 - Page 12 News List

Property sentiment turns bullish despite slow recovery pace

By Joyce Huang  /  STAFF REPORTER

Despite a slow economic recovery, domestic home buyers have turned bullish in the property market. A survey released by Evertrust Rehouse Co (永慶房屋) yesterday found that 62 percent of respondents were poised to shop for homes in the second half of the year.

That was the biggest vote of confidence — higher than 60 percent in the previous quarter and during the post-presidential election period last March — since the quarterly survey was launched in late 2006.

“Buying sentiment and confidence are picking up faster than [home buyers had] expected,” the realtor’s president, Yeh Lin-chi (葉凌棋), told a media briefing.

Yeh attributed the optimistic sentiment to a boost from the government’s stimulus measures, in particular the recent relaxation of restrictions on potential Chinese property buyers.

Some 54 percent of the survey’s respondents, up from just 14 percent in the previous quarter’s survey, said property prices would go up in a year, while only 26 percent, down from the 75 percent in the first quarter’s survey, believed prices would continue to drop next year.

However, Evertrust Rehouse adviser Greg Yeh (葉國華) said that “it’s no longer a buyer’s market, which ended one or two months ago.”

Many sellers are no longer in a hurry to liquidate their properties, banking on future inflows of Chinese capital to increase the nation’s property prices, he said.

The majority of respondents, however, were aware that potential inflows of Chinese capital would only benefit commercial properties such as office buildings and storefronts, as well as the luxury home sector.

Benson Liao (廖本勝), president of Evertrust Group (永慶集團), the parent company of Evertrust Rehouse (永慶房屋), yesterday forecast that the nation’s property market may only see a solid rebound in the fourth quarter after property developers, who are still maintaining a wait-and-see attitude, begin to invest.

He said that the domestic residential property market would see a limited and indirect upside from the anticipated inflow of Chinese capital.

But the news, along with the government’s stimulus measures, appears to have irrationally driven up property owners’ expectation on gains.

This will make a young buyers’ dream of owning a home more difficult, said Chuang Meng-han (莊孟翰), an economics professor at Tamkang University.

“Warming cross-strait relations have dragged both the nation’s stock and real-estate markets away from their fundamentals,” he said, warning that some of the nation’s economic fundamentals haven’t bottomed out yet.

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