Property inflation has been temporarily contained following the central bank’s credit-tightening measures, but the risk of a real estate bubble still exists because of excess liquidity in the market, an academic told a real estate conference yesterday.
“Strong Asian economic growth, China’s flexible exchange rate regime and the European debt crisis will lead to ‘hot money’ flowing to East Asia. [The government] should take precautions against a property bubble,” Hu Sheng-cheng (胡勝正), a research fellow at Academia Sinica, said during the annual conference of the Global Chinese Real Estate Congress (世界華人不動產學會).
Calling on the government to boost internal demand and divert liquidity to investment projects, Hu said the nation’s excess savings are increasing by more than NT$100 billion a year and that the concept of “housing affordability” should be consolidated in public housing policy.
The central bank has recently implemented targeted prudential measures to curb housing price inflation, which he said would be more effective than a comprehensive monetary policy as property inflation is a regional issue.
Because rising house prices are concentrated in the greater Taipei area, along with the government’s effective supervision on mortgage lending, local real estate inflation would not likely lead to a major financial crisis, said Hu, a former chairman of the Council for Economic Planning and Development.
“If a property bubble were to take shape, our economy would certainly slow, but it would not go so far as to collapse. This is because Taiwan’s mortgage securitization is not as extensive [as that of the US],” Hu said, referring to the US sub-prime mortgage crisis that led to the global financial crisis in 2008.
Meanwhile, Beijing-based Vantone Group (萬通集團) chairman Feng Lun (馮侖), who also participated at the conference, said Taiwan could become one of the top immigration destinations for Chinese in the wake of the signing of the Economic Cooperation Framework Agreement (ECFA).
Feng, who is reported to be planning to build luxury recreational residences in Taipei, said the Taiwanese property and capital markets are appealing to Chinese investors, adding that cross-strait real estate industries would complement each other following the implementation of the ECFA.
“Both the over-the-counter market and the stock market are buoyant in Taiwan. Although the loan-to-value ratio cannot exceed 50 percent for Chinese borrowers, low interest rates are still very attractive to them,” Feng said.
Amid media speculation that Chinese investment in the local property market would boost property inflation and make it harder for Taiwanese to buy a house, Feng said both sides of the Strait would “benefit from each other, rather than damage each other.”
“Chinese people who wish to purchase property in Taiwan will not buy residential homes, but instead they are interested in investing in recreational buildings ... not only will it not fuel soaring housing prices, but it will also encourage more Chinese to spend in Taiwan,” Feng said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
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