The new-home market fared better than the nation’s major economic bellwethers last month as new construction volume picked up and the room for price concessions narrowed, a report by the Chinese-language Housing Monthly showed yesterday.
The monthly market-sentiment signal flashed a third “yellow-blue” light, suggesting the market is shifting gears, with the total score just one point away from the stable “green” light, the report said.
“While the nation’s economy remains in slowdown mode, the new-home market appears to find support in terms of construction volume and price levels,” according to the magazine’s researcher, Chen Yun-ru (陳韻如).
Developers added more than 400 presale housing units last month, raising the total estimated value by NT$16.5 billion (US$55 million) from June, with new projects mostly located in Sansia (三峽), Tamsui (淡水) and Sinjhuang (新莊) in New Taipei City (新北市); Taoyuan and northern Hsinchu, the report said.
Transactions jumped 17 percent last month from June, while the number of potential buyers grew by 6.53 percent and housing advertisements increased by 6 percent, the report said.
Chen attributed the pickup to the implementation on Wednesday of registration rules that require buyers, brokers and administrative agents to file transaction details, including prices.
Some investors prefered to withhold trading information from the government for fear it could be used to increase their tax burdens, Chen said.
The Ministry of Finance has said it would mull the possibility of taxing real-estate properties based on their real prices after collecting sufficient data.
The room for bargaining tightened last month with the index shedding 4 percentage points to 10.4 percent, the report said.
Record high offers by domestic developers and life insurance companies to acquire properties in the capital’s prime Xinyi District (信義) also helped boost sentiment, Chen said.
On July 20, Nan Shan Life Insurance Co (南山人壽), the nation’s third-largest insurer by market share, won the leasehold auction to redevelop the Taipei World Trade Center’s Hall 2 for NT$26.8 billion (US$893.33 million), outbidding Cathay Life Insurance Co (國泰人壽).
Ten days earlier, Continental Engineering Corp (大陸工程) bought an undeveloped plot of land nearby for a record NT$4.4 billion.
“While the overall sentiment remains weak, prices for properties in prime locations continue to hit new highs,” Chen said.
The existing home market in Taipei City also turned out stronger last month, according to official data released on Wednesday.
Second-hand home transactions totaled 4,215 units, rising 14 percent from 3,684 units sold one month earlier, Taipei City Government statistics showed, bucking double-digit declines reported by major brokers days earlier.
Nangang District (南港) showed the sharpest monthly increase of 93 percent among the Taipei City’s 12 administrative districts last month, with 305 units bought and sold.
That was followed by Daan District’s (大安) 48 percent increase, with 526 units sold, and Shihlin District’s (士林) 46 percent increase, with 368 units sold, the statistics showed.
Local property brokers attributed the growth to higher settlement of pre-sale home cases and the implementation of the new registration rules.