Thu, Mar 19, 2015 - Page 13 News List

Construction companies to focus on spring sales

TABOO SUBJECT:Online property broker HouseFun said that developers have been avoiding the Taoyuan Aerotropolis project due to an ongoing investigation

By Crystal Hsu  /  Staff reporter

Developers and construction firms plan to offer NT$330 billion (US$10.46 billion) in presale and new home projects during the spring sales season and lie low in the second half of the year when presidential campaigns begin to heat up, online property broker HouseFun (好房網) said yesterday.

The forecast represents a 28 percent increase from a year earlier, as construction companies seek to promote sales in the first half and embrace a sluggish market for the rest of the year until the presidential election in January next year, company head Ni Tzu-jen (倪子仁) said.

The spring sales season begins in late March and lasts through April.

“The actual figures might prove lower given weak sentiment,” Ni said by telephone, predicting a fall in both construction volume and new home prices this year.

Developers and construction firms boasted of a NT$430 billion total for the season last year, but actual numbers turned out 40 percent lower, at NT$258 billion, Ni said.

There are 46 projects in northern Taiwan with a construction value exceeding NT$1 billion, accounting for more than 70 percent of the total, HouseFun said.

Construction volume totals NT$129.9 billion in Taipei and NT$66.3 billion in New Taipei City, as property funds flow back to Taipei, where home prices are less vulnerable to price corrections due to strong demand and limited supply of land, the broker said.

Construction volume amounts to NT$21.1 billion in Taoyuan and NT$16.1 billion in Hsinchu, representing 14.7 percent of the total and suggesting cooling compared with the past few years when developers and builders actively rolled out new home projects to take advantage of improving public infrastructure facilities, Ni said.

“No one is talking about the Taoyuan Aerotropolis project anymore these days,” Ni said, after new Taoyuan Mayor Cheng Wen-tsan (鄭文燦) ordered a probe into the multimillion New Taiwan dollar development project surrounding Taiwan Taoyuan International Airport.

Farglory Land Development Co (遠雄建設), Highwealth Construction Corp (興富發), Fubon Land Development Co (富邦建設) and other major construction firms are all participating in the spring sales season.

However, prospective buyers might hesitate to make a purchase unless developers are willing to further lower asking prices, Ni said.

While various construction sites have received more prospective buyers after the Lunar New Year holiday, transactions remain soft, Ni said.

“Price concessions of between 10 percent and 15 percent are necessary to attract buyers to close deals,” Ni said.

Construction firms and developers appear unwilling to concede that much, though some agreed to cut prices by 5 percent to 8 percent last year, he said.

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