Real-estate brokers hail property disclosure bill

By Crystal Hsu  /  Staff Reporter

Tue, Sep 20, 2011 - Page 12

Major real-estate brokers welcomed the property transaction disclosure bill, saying the planned legislation will make housing sales more transparent and accountable in the long run, although it may deepen cautious sentiment in the short term.

Chinatrust Real Estate Co (中信房屋) said it believed the disclosure bill, coupled with supporting tax reforms, would trigger a price correction and cool transactions once it was passed into law.

The requirement for home buyers, real-estate brokers and land administration agents to register actual transaction prices must be supported by taxes based on the values to be successful in curbing housing prices, Chinatrust Real Estate said, citing a recent poll.

Nearly 57 percent of respondents voiced that view on the legislation intended to advance housing justice, a key campaign platform of both the ruling and opposition camps.

The Cabinet introduced the bill on Thursday in a bid to rein in runaway housing prices, which remain unresponsive thus far to the special sales levy, better known as the luxury tax, and other tightening measures.

About 60 percent said the disclosure requirement alone could constrain transactions, but might prove inadequate in facilitating a price fall, Chinatrust Real Estate said.

“The disclosure legislation would end up another slogan in the absence of tax reforms,” the Taipei-based broker said.

Currently, property owners have to pay taxes on houses and land based on the government’s assessed values, which are much lower than their market prices.

The value gap is partly blamed for fanning real-estate fever because it renders holding costs insignificant compared with transfer profits.

Gary Wu (吳光華), law director at H&B Realty Co (住商不動產), the nation’s largest housing broker by number of franchises, said the disclosure stipulation would help normalize the real-estate market because it would discourage price manipulation.

Because of limited resources, individual buyers have difficulty judging the accuracy of reported price hikes, Wu said.

While boosting transaction transparency, the disclosure requirement may not weigh on property prices, as seen in Hong Kong and China, where housing prices keep rising because of solid demand, Wu said.

Stanley Su (蘇啟榮), head researcher at Sinyi Realty Inc (信義房屋), Taiwan’s only listed broker, said legislation intended to protect buyers would help speed up transactions.

“Prospective buyers and sellers would feel more comfortable about transactions after authorities set up a database allowing the public to check property prices,” Su said.

The disclosure rule could take effect next year if the bill clears the legislature later this year.