Mon, Dec 26, 2011 - Page 12 News List

New loans from major mortgage firms on the up

Staff Writer, with CNA

New loans extended by the nation’s five major mortgage suppliers grew slightly last month, as the local real-estate market cooled after the government imposed a luxury tax to cap rising property prices, the central bank said on Friday.

According to the central bank, new mortgages provided by the five lenders totaled NT$44.71 billion (US$1.48 billion) last month, an increase of about NT$687 million from October, although the figure was at its second-lowest level in nine months.

The five major mortgage lenders are Bank of Taiwan (台灣銀行), Taiwan Cooperative Bank (合庫銀行), Land Bank of Taiwan (土地銀行), Hua Nan Commercial Bank (華南銀行) and First Commercial Bank (第一銀行).

The central bank said that with speculators retreating from the market because of the luxury tax, the number of property transactions fell 34.08 percent to 3,428 in Taipei last month, while the figure in New Taipei City (新北市) fell 43.82 percent to 5,650.

As a result, new loans extended by the five major mortgage lenders posted only a small increase last month, the central bank added.

The luxury tax came into effect in June, with a 15 percent tax on non-self-use homes that are sold within one year of purchase and a 10 percent tax on properties sold in the second year.

The Taipei City Government said earlier this month that property prices in the capital were rising, but not as sharply as before the introduction of the tax.

According to a recent survey conducted by Evertrust Rehouse Co (永慶房屋), the national property market is expected to post the lowest number of transactions in eight years, and it could fall below 360,000 deals this year.

Meanwhile, loans extended by the five lenders to meet the need for capital investments totaled NT$40.91 billion last month, up NT$2.41 billion from a month earlier, while consumer loans during the period rose NT$7.27 billion from October to NT$11.30 billion last month, the central bank said.

Last month, loans provided by the five banks for working capital rose NT$88.8 billion from the previous month to NT$598.7 billion, the central bank said.

The average lending rate of the five banks fell 0.094 percentage points from the previous month to 1.511 percent, the central bank added.

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