Sinyi Realty Inc (信義房屋), the nation’s only listed brokerage, aims to expand into an international real-estate service provider in the next decade with 10,000 offices in the Greater China area, company executives said yesterday.
The broker will press ahead with plans to increase the number of directly operated and franchise offices in Taiwan and China from the current 560 to 750 at the end of this year, unfazed by the impending luxury tax on property transactions, Sinyi president Jeremy Shiue (薛健平) said.
PROPERTY TAX
“The company has survived worse property market downturns since it was founded in 1981” as a notary signing service agency (信義代書), Shiue told a media briefing to mark the firm’s 30th anniversary.
The levy, which is likely to take effect on June 1, is slowing property sales, but will not weaken real housing demand or market fundamentals, Shiue said.
The Ministry of Finance is drawing final details about how to impose the 10 percent tax on properties resold within two years of purchase and certain luxury goods. The rate will climb to 15 percent of the transaction price for properties sold within one year of purchase.
The planned implementation of the luxury tax, which has caused property transactions to plunge by 30 percent over the past one-and-a-half months, appeared to have limited impact on Sinyi’s earnings.
Consolidated revenue totaled NT$2.3 billion (US$79.58 million) in the first quarter, rising 18.26 percent from the same period last year, Taiwan Stock Exchange data showed.
Net profit jumped 33.56 percent to NT$1.9 billion last year from a year earlier, translating into earnings of NT$5.42 per share, the data indicated.
UNSURE EFFECTS
“Longer observation is needed to gauge the impact of the luxury tax, which may become more evident this quarter,” Shiue said.
However, the luxury tax, has made the broker more cautious about housing prices, which it expects to stay flat this year, he said. Its previous forecast was growth of 5 percent to 10 percent.
Fundamentally, Sinyi remains upbeat about the sector’s growth dynamism and intends to tap further into the vast Chinese market.
The firm has about 210 directly operated and franchise offices in different parts of China and aims to boost the number to at least 320 before the end of this year, chief strategy officer Howard Chou (周莊雲) said.
BOOMING CHINA
“China, the world’s most populous nation with a booming economy, will play a crucial role in our bid to develop into a global property broker,” Chou said. “It will be home to most of the planned 10,000 offices in 2020.”
Only 10 percent of the number will be based in Taiwan, where property transactions are expected to hit 400,000 units nine years later, far lower than the forecast of 10 million cases for China, Chou said.
“The absence of language and cultural barriers makes the goal realistic,” he said.
Sinyi has 351 offices in Taiwan and plans to raise the number to 400 by the year’s end.
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