Home sales shot up sharply last month as speculators sold their holdings ahead of the implementation of a luxury tax this month, major real-estate agencies said yesterday.
Sinyi Realty Co (信義房屋), the nation’s only listed property broker, saw housing transactions rise 10 percent last month from April, while Evertrust Rehouse Co (永慶房屋), the largest brokerage by number of outlets, reported a 20 percent increase.
The two real-estate service -providers attributed the pick-up to selling pressure triggered by the luxury tax, which subjects properties resold within two years of purchase to taxes of 10 to 15 percent of the transaction price starting on June 1.
“The selling pressure grew keener as the tax drew nearer,” Sinyi head researcher Stanley Su (蘇啟榮) said by telephone.
Housing transactions surged 60 percent during the last week of last month, compared with the first week, as sellers were more willing to lower prices to avoid the levy, Su said.
Sinyi’s home sales last month increased 15 percent in Taipei City and 12.6 percent in New Taipei City (新北市) compared with a month earlier, Su said, adding that “investment” accounted for a sizable number of the transactions in the Greater Taipei area.
Trading was nearly steady in other parts of the country, based on Sinyi’s data.
Evertrust Rehouse, which focuses on northern Taiwan, said its home sales regained momentum last month, rising 15 percent from April.
Evertrust associate manager Jeffery Huang (黃增福) linked the improvement to portfolio adjustment on the part of investors rather than a real-estate revival.
“Panic selling accounted for the improvement in May,” Huang said by telephone. “Home transfers still lagged behind January levels by 15 to 20 percent.”
News about the luxury tax started to impact the market in late February.
The latest government data available showed that home transactions totaled 30,275 units in April, falling 23.02 percent from March. Regional breakdowns showed that transactions in Taipei City shrank 28.5 percent to 3,957 cases, while those in New Taipei City dropped 28.2 percent to 6,700 cases.
Nevertheless, housing prices were largely unchanged last month compared with a month earlier, Sinyi and Evertrust statistics showed.
Both Su and Huang said high excess liquidity and low interest rates continued to support home prices amid a stable economy.
“Real-estate properties have proven to be an effective defense against inflation and are safe investments, compared with other [investment] tools,” Su said.
Huang said Taiwan’s warming trade ties with China helped feed the optimistism.
The two analysts expected the housing market to turn quiet in the coming months until the end of the lunar Ghost Month in late August.
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