Transfers of residential and commercial housing units fell last year due to an economic slowdown and the government’s efforts to curb market speculation, according to statistics released by the Ministry of the Interior yesterday.
The statistics showed that sales of homes, shops and offices last year totaled 329,741 units, down 9 percent from a year earlier. Last year’s figure was the lowest since 2002, when property transactions dropped to 320,285 units.
Property sales in Taipei City and New Taipei City (新北市) fell about 20 percent, while markets in Taoyuan County and Greater Kaohsiung bucked the downtrend to post an increase in transactions, the statistics showed.
Tseng Ching-der (曾敬德), a researcher at Sinyi Realty Inc (信義房屋), said the decline in housing transactions was the result of a weakening domestic economy and the implementation of the luxury tax and property price registration mechanism.
Last year, Taiwan’s economic growth slowed to 1.25 percent from 4.07 percent in 2011.
The luxury tax was put in place in June 2011 to curb speculation, particularly in northern Taiwan. It mandates a 15 percent sales tax on second homes sold within one year of purchase and a 10 percent sales tax on properties sold between one and two years after they were bought.
The property price registration mechanism, which took effect in August last year, has strengthened transparency in the property market as part of efforts to discourage speculation.
In Taipei, housing transactions last year fell 23 percent from a year earlier to 38,571 units, while property transfers in New Taipei City dropped 18 percent to 69,187 units.
However, in Taoyuan property transactions rose 1 percent to 45,886 units, and in Kaohsiung 6 percent to 39,625 units.
Tseng said the growth in those two areas largely reflected the launch of new residential projects and the start of infrastructure development.
According to the government statistics, the property markets in Hsinchu County, Taichung and Tainan also appeared resilient compared with Taipei and New Taipei City.
Transactions in Hsinchu and Taichung dropped 8 percent, and declined 2 percent in Tainan.
Tseng said he was more upbeat about the local property market this year, as the economy has been showing signs of improving.
The government has upgraded its economic growth forecast for this year from 3.15 percent to 3.53 percent.