Sinyi Realty Inc (信義房屋), Taiwan’s only listed real-estate broker, said its net income shrank 25 percent last quarter from a year earlier on falling transactions attributable to economic uncertainty and the upcoming presidential election, senior executives told investors yesterday.
Net income dropped to NT$291.43 million (US$9.66 million) between July and September, the company’s report showed.
That represented a decrease of 6.46 percent from the previous quarter.
Sinyi blamed a smaller trading volume for the decline, according to Sinyi chief financial officer Sandy Chou (周素香), saying that home transfers decreased 12.5 percent year-on-year, or 13.8-percent quarter-on-quarter, to 82,664 units last quarter.
In the first nine months, net profit shrank 22 percent year-on-year to NT$929.44 million, or NT$2.12 per share, Chou said.
Net profit margins dropped 4 percentage points last quarter to 14.49 percent from 15.46 percent three months earlier, owing to a continued increase in the number of outlets, which has now reached 377, she said.
The firm’s plan to raise the total to 400 this year remains unchanged, although the company would adopt a more conservative development plan next year as conditions turn more uncertain at home and abroad, Chou said.
“The company will finalize development details later this month,” Chou said.
That cautious approach will also apply to Sinyi Realty’s venture in China, which has yet to turn profit so far because of unfavorable housing policies there, she said.
Greater Taipei saw housing prices retreat slightly last month as buyers started to soften after the landscape failed to improve for two consecutive quarters, Sinyi Realty head researcher Stanley Su (蘇啟榮) said.
Housing prices dropped 3.9 percent to NT$549,000 per ping (3.3m2) last month in Taipei, which continued to bear the brunt of the correction, with home transfers near their low during the global financial crisis at 3,255 units last month, Su said.
Home costs appeared firmer, falling 2.1 percent to NT$280,000 per ping in New Taipei City (新北市), Su said.
Su expects the housing market to remain sluggish ahead of the Jan. 14 presidential election as a recent poll showed 52 percent of prospective home buyers prefer to stay on the sidelines until the race settles.
Many expressed plans to postpone purchase decisions until they have a better grasp of the government’s housing policy and whether it will introduce further measures to curb housing prices, Su said.
Many also want to know if Taiwan will continue to improve trade ties with China, Su added.
“Some hope closer ties with China will help boost housing prices here, while others wish to see concrete price corrections to make housing more affordable,” Su said.
Shares in Sinyi Realty closed down 0.5 percent at NT$39.5 yesterday, under-performing the TAIEX, which gained 0.8 percent, Taiwan Stock Exchange data indicated.
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