Property transactions dropped 19.6 percent to a six-month low in the five major metropolises last month, as rainstorms and policy uncertainty weighed on the market, analysts said yesterday.
A total of 16,374 residential and commercial properties changed hands last month, shrinking 19.6 percent from July and 17.5 percent from a year earlier in Taipei, New Taipei City (新北市), Greater Taichung, Greater Tainan and Greater Kaohsiung, according to data released by the five local governments earlier this week.
The figure was the lowest since February this year, when the nine-day Lunar New Year holidays disrupted activity.
Andy Huang (黃舒衛), a researcher at Evertrust Rehouse Co (永慶房屋), the nation’s largest real-estate agency by number of offices, attributed the decline to stormy weather which kept prospective buyers at home.
Talks by the Ministry of Finance on maintaining and tightening the special sales tax also drove investors to the sidelines, Huang said.
The ministry held a public hearing last month on the tax, which subjects all houses resold within two years of purchase to a special sales levy of up to 15 percent of their transaction prices.
Panelists at the meeting suggested shifting the tax burden to buyers and extending the taxable period to three or five years to further curb property speculation.
Developers and brokers have called on policymakers to ditch the levy, saying it has failed to trigger a price correction and only depressed trading at the cost of the state coffers.
Taipei reported the sharpest decline of 32.4 percent last month, followed by a 26.2 percent fall in Greater Tainan and 22.3 percent in Greater Kaohsiung, government data showed.
New Taipei City and Greater Taichung also recorded double-digit falls, declining 13.7 percent and 13.9 percent respectively, data showed.
Sinyi Realty Inc (信義房屋), the nation’s only listed broker, said the Ghost Month — which fell on Aug. 7 to Sept. 4 this year — was also to blame for the sluggish trading last month.
“While young people assign less importance to the tradition, many still refrain from purchasing homes during the period to avoid misfortune,” Sinyi researcher Tseng Chin-der (曾敬德) said.
Many buyers and sellers closed deals ahead of the inauspicious month, thereby raising the comparison bar for July, Tseng said.
Another real-estate broker, Taiwan Realty Co (台灣房屋), shared similar observations, saying the market may recover this month, aided by purchases by first-time buyers and people seeking to relocate.