Land transactions topped NT$40 billion (US$1.27 billion) in the first quarter of this year, posting an increase of nearly 40 percent from the NT$28.6 billion registered last quarter, real estate consultancy firm DTZ (戴德梁行) said yesterday.
Most deals were completed in the Greater Taipei area, accounting for about NT$24 billion — more than half the total amount — the Taipei-based firm said, adding that the actual figure could be 20 percent to 30 percent higher once deals that have not yet been disclosed were included.
“The National Property Administration’s [NPA] move to stop auctioning large-scale properties made it harder for developers to acquire land and forced them to buy from private owners, further propping up prices,” Charlie Yang (楊長達), chief of valuation and advisory services at DTZ, told a media briefing yesterday.
Yang said Taipei-based Huang Hsiang Construction Corp (皇翔建設) acquired a 309 ping (1,021m²) plot of land auctioned by the NPA for a floor price of up to NT$1.5 million at the end of January.
A quarterly report on the local real estate market released by the consultancy firm showed large-scale commercial property transactions rose 40 percent year-on-year to NT$18.5 billion in the first quarter on the back of liquidity-driven investment.
Yang said besides excess liquidity, a government-proposed trade pact with China could thaw cross-strait political tensions and boost confidence in the property market, leading to an uptick in prices for commercial properties.
“Rental rates [for office space] in Taipei City are still extremely low when compared with other major Asian cities,” Yang said.
Yang said the limited supply of commercial properties in Taipei was another factor driving up the rates for office space.
“There is an average demand of 20,000 pings a year, compared with only 10,000 pings released to the market,” he said.
The report said that life insurance companies invested NT$8 billion in the property market in the first quarter, accounting for 38 percent of the total amount.
Cathay Life Insurance Co (國泰人壽) secured two land deals in Neihu District (內湖) for NT$1.98 billion and NT$960 million.
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