Taiwan’s housing prices climbed higher in the first quarter, although the home loans to income ratio dropped slightly, suggesting that an impending luxury tax failed to trigger a price correction, an industry expert said yesterday.
The average price of housing transactions in the January-to-March period was NT$8.54 million (US$299,649), rising 6.8 percent from NT$8 million three months earlier, according to a survey by the Construction and Planning Agency.
That constituted 8.2 times the income of average households, from 8.9 times in the preceding quarter, the second-highest in the history of the survey, but it eased for the first time in three years on income improvement, the poll showed.
“The latest figures are disappointing because they show the luxury tax is ineffective in reining in housing prices,” said Chang Chin-oh (張金鶚), a land economics professor at National Chengchi University, which conducted the survey.
Starting this month, the government is imposing a tax of 10 to 15 percent of the transaction price of properties resold within one to two years of purchase in the hope of cooling the housing fever. The tax plan was made known in late February and sapped housing transactions by 30 percent in March and April.
Despite the cautious sentiment, 46 percent of the respondents expect home prices to rise further in the coming six months, outnumbering those with a bearish view at 37.6 percent, the survey indicated.
Chang attributed the trend to the government’s inconsistent attitude on the issue: introducing a luxury tax, while offering favorable mortgage terms for young homebuyers.
“The mixed messages left the market clueless on how to respond,” Chang said. “Housing prices may stage an aggressive comeback if the government fails to collect the luxury tax based on real transaction value.”
Currently, there are no rules requiring real-estate brokers to file transaction details and the government can only rely on taxpayers to report dealings honestly for tax purposes.
“It is odd that talks of the timing for home purchases, instead of price drops, have dominated the market lately,” Chang said. “The government can help reverse the direction by showing more resolution in carrying out the luxury tax.”
Housing prices in Taipei averaged NT$17.62 million in the first quarter, gaining 17.47 percent from NT$15 million three months earlier, the survey said.
The figures accounted for 13.2 times of household incomes in the capital, moderating from 14.3 times in the previous quarter, the survey said.
Mortgages took up 52 percent of homeowners’ income in Taipei, compared with 56 percent three months earlier, the survey said.
The burden, while easing a bit, remains far higher than the one-third threshold recommended by financial consultants.
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
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
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],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts