Taiwan’s presale housing market is likely to stagnate in the second half of the year as developers turn conservative after sales showed signs of weakening recently compared with the first quarter, a report by the Chinese-language Housing Monthly showed.
The volume of new construction — including presale projects and newly completed houses — is valued at NT$429.9 billion (US$14.32 billion) in northern Taiwan in the second half, compared with NT$430.01 billion during the first half of the year, the report said.
That means a construction volume of NT$860 billion for the whole of this year, down 12 percent from the magazine’s projection of NT$980 billion in December last year, the publication’s spokesman Ni Tzu-jen (倪子仁) said.
“Developers and construction firms will adopt a conservative strategy to avoid inventory pressures as the economy muddles on,” Ni said. “The implementation of the registration requirement for all housing transactions next month also merits caution.”
The registration rule, which requires buyers, sellers and agents to enter transaction details into a government online database, will limit room for advertisement campaigns to boost prices, Ni said.
The coming two quarters may see transactions in this segment of the market flatten or decline slightly, with stable prices, Ni said.
The destocking pressure is the most evident in New Taipei City (新北市) where new construction volume plunged 41 percent for the first six months to NT$88.8 billion, from NT$15.09 billion during the same period last year, the report found.
The housing supply in the metropolitan area has picked up sharply in recent years on migration demand from people who cannot afford homes in Taipei, Ni said, adding that the trend is losing steam as housing prices in New Taipei City become increasingly unaffordable.
The recent launch of more than 4,000 semi-public housing units in Fujhou (浮洲), New Taipei City, will also constrain demand for a while, said Evertrust Rehouse Co (永慶房屋), the nation’s largest real-estate agency by number of outlets.
Priced below NT$200,000 per ping, the project has attracted more than 20,000 applicants.
In addition, the planned extension of the mass rapid transit system to Taiwan Taoyuan International Airport will also attract more people to the county, Evertrust said.