Housing sales rise as stable prices encourage buyers

RENEWED INTEREST::Sellers are reluctant to cut prices as buying interest improves, which might be unwise, as bad loans could increase, an analyst said

By Crystal Hsu  /  Staff reporter

Fri, Jun 01, 2018 - Page 12

Major property brokers saw a double-digit percentage improvement in housing transactions last month from a year earlier, as buyers felt comfortable enough to join the market after home prices showed signs of stabilization.

H&B Business Group (住商不動產), the nation’s largest home brokerage by number of franchises, said that total housing transactions might increase an estimated 10 percent from a year earlier, led mainly by a recovery in buying interest in the greater Taipei area.

The improvement was likely due to demand after housing prices remained stable, H&B chief researcher Jessica Hsu (徐佳馨) said in a report released yesterday.

“Buyers who stayed on the sidelines for fear of price corrections decided to take action,” Hsu said.

A recovery in buying confidence was most evident in Taipei and New Taipei City, where home prices appeared to have hit a low, as evidenced by a decline in unreasonable price offers, Hsu said.

The ability to negotiate price concessions was limited by a stable economy and looming interest rate hikes abroad and domestically, said Mandy Lang (郎美囡), an analyst at Great Home Realty Co (大家房屋), an affiliate of H&B.

Sinyi Realty Inc (信義房屋), the nation’s only listed real-estate broker, said it saw a 12 percent year-on-year increase in overall housing deals last month, led by increases of more than 30 percent in Taipei and 18 percent in New Taipei City.

First-time home buyers and people with asset allocation needs drove the upturn with apartments priced between NT$15 million and NT$20 million (US$500,334 and US$667,111), with sales mostly anchored in New Taipei City, Sinyi researcher Tseng Ching-der (曾敬德) said.

As for Taipei, buyers displayed a penchant for central locations, Tseng said.

Home prices remained strong at NT$619,000 per ping in the capital and were steady at NT$334,000 per ping (3.31m2) in New Taipei City, he said.

Housing deals increased a modest 6 percent from a year earlier in Taoyuan, with an average price of NT$185,000 per ping, Sinyi said.

Evertrust Rehouse Co (永慶房屋), the nation’s largest brokerage by number of offices, forecast last month recorded a 10 percent increase in property transactions, amid flat prices.

As buying interest improved, sellers grew increasingly reluctant to cut prices, Evertrust spokesman Jay Hsieh (謝志傑) said.

The lack of pricing flexibility might prove unwise, after financial regulators voiced concern over local banks’ offers of grace periods for mortgage applicants, Hsieh said, adding that this might result in unfavorable policy moves if bad loans continue to pick up.