Property market sees modest rise despite policies

CAPITAL LAGS::Although Taipei still experienced smallish price rises, many buyers opted for lower-cost areas, especially those with enhanced transport links

By Crystal Hsu  /  Staff reporter

Sat, Jan 26, 2013 - Page 13

New home prices picked up modestly last quarter from three months earlier, while transaction volumes slipped slightly, suggesting that the market is emerging from a period of slowdown but remains weighed down by unfavorable government policies, a report released yesterday showed.

Developers and construction firms put 15,740 apartment units on the market during the October-to-December period last year, down 7.3 percent from the third quarter, while overall market value gained 7.3 percent to NT$303.7 billion (US$10.39 billion), according to a quarterly report by Cathay Real Estate Development Co (國泰建設) and National Chengchi University’s Taiwan Real Estate Research Center (台灣房地產中心).

“Seasonal demand accounted for a rebound in prices, while cautious sentiment continued under moderate trading,” said Chang Chin-oh (張金鶚), who teaches land economics at National Chengchi University and leads the research panel.

The fourth quarter is a traditional peak season for the property sector as many Taiwanese get married ahead of the Lunar New Year and buying a home is deemed an important part of starting a new family.

New home prices averaged NT$263,700 per ping (3.3m2) nationwide last quarter, rising 6.32 percent from a quarter earlier, while 30-day trading volume gained 14.21 percent, indicating that it took less time to close deals, the report said.

New properties cost an average of NT$764,900 per ping in Taipei and NT$403,900 per ping in New Taipei City (新北市), an increase of 4.97 percent and 15.58 percent respectively from the third quarter, the report said.

Hua Ching-chun (花敬群), a finance and banking professor at Hsuan Chuang University, said that second-tier locations gained popularity with homebuyers, thanks to extension of the MRT metropolitan railway system to New Taipei City and Taoyuan County.

Investment in new housing projects topped NT$600 billion in New Taipei City for the past two years and NT$465.6 billion in Taoyuan and Hsinchu combined, as the capital lost its luster because of its relatively high prices, Hua said.

The academic also voiced concerns over oversupply in the market given the growing number of unoccupied houses in certain areas.

The housing rebound was more evident in central and southern Taiwan as new home transactions surged 68.34 percent in Greater Taichung last quarter and more than doubled in Greater Kaohsiung, the report showed.

Booming demand lifted new home prices by 6.7 percent last quarter to NT$130,900 per ping in Greater Taichung, while costs in Greater Kaohsiung edged up 0.65 percent to NT$160,600 per ping, the report said.

Property fever appears to have migrated southward after being subdued in Taipei, Chang said.

Chang urged potential buyers to wait until the market assimilates the impact of the government’s recent price-registering measure, saying: “Time is on the buyers’ side.”