Taiwan’s existing home transactions rose 48 percent in the second quarter from three months earlier, but the momentum appears to have slowed somewhat this quarter as economic conditions worsen, a government report showed yesterday.
The April-to-June period saw 53,502 housing units change hands, an increase of 48 percent from the first quarter, driven by pent-up demand that was more evident in southern Taiwan, according to the quarterly report by the Ministry of the Interior’s Construction and Planning Agency.
The figures represented a 4 percent decline compared with the same period last year, extending a slowdown since the introduction in June last year of a special sales levy that imposes up to 15 percent taxes on houses resold within two years of purchase, the report found.
“The rebound may come to an end in the current quarter as the macro-environment turns unfavorable,” said Chang Chin-oh (張金鶚), a land economics professor at National Chengchi University, who delivered the report on the agency’s behalf.
Domestic financial institutions have recently tightened granting home loans at the request of the central bank and the Financial Supervisory Commission, slowing funds from flowing to the property market to boost house prices and trigger potential asset bubbles.
Chang said a new registration measure, under which home buyers, real-estate brokers and administrative agents must file transaction details — notably the transaction price — within one month or face fines, would start to weigh on the housing market. The government implemented of the new measure on Aug. 1.
Starting in October, the public may have access to such data, allowing them to gain better understanding of actual property values, Chang said, adding that prospective buyers may want to stay on the sidelines until the information is available.
House prices averaged NT$9.22 million (US$307,600) a unit in the second quarter, rising 10 percent from the first quarter, the report found, countering various measures to reverse the trend.
House costs amount to 8.5 times the individual household incomes, with mortgage burdens constituting 34 percent of their payroll, the report indicated.
The affordability readings climb steeply in Taipei City, with home prices standing at 13.7 times the annual household incomes and mortgage burdens making up 46 percent of take-home salaries, the report said.
Investment needs drove 48 percent of house transfers last quarter, followed by self-occupancy at 33 percent, the report said.