The property-market recovery remains strong and the market will continue its gradual upswing for the next two quarters, despite recent political turmoil, according to a government report released yesterday.
The report, issued by the Architecture and Building Research Institute under the Ministry of the Interior, shows that property-related companies were positive about the sector this quarter and have great optimism for the next two quarters.
"A mild recovery is certainly underway and the overall market fundamentals are in healthy shape," Chang Chin-oh (
More than 60 percent of the polled companies, including construction firms, brokers, advertising companies and land appraisers, expressed confidence in the post-election market, the report said.
While the survey was conducted before the March 20 election, between Feb. 16 and March 8, Chang said he believed "political uncertainties will be only short-lived and will not affect the property sector."
Of the three metropolitan areas in northern, central and southern Taiwan, Taichung was described by 76.5 percent of polled companies as a good potential market for development, the report said. Taipei got the thumbs up from 57.1 percent of the companies and Kaohsiung 45.5 percent.
Lai Cheng-i (
"With the Central Taiwan Science Park (中部科學園區) and high-speed railway under construction in Taichung, this is definitely the hottest market," Lai said. "The real-estate sector is now reliving the fever it experienced 15 years ago."
Public optimism would be reinforced if the nation's relations with China can be kept on good terms, he added.
On the TAIEX yesterday, the construction sector continued its strong performance, as investors hope the worst of the post-election turmoil is over. A total of 25 construction stocks closed at or near the 7 percent limit on daily stock movements. King's Town Construction Co (
The property market had been in a slump for over a decade before it started to bottom out in the second half of last year.
"Supply and demand are gradually reaching a balance as demand is rising" thanks to low interest rates, said Wendy Hsueh (薛惠珍), research director at the international real estate consultancy DTZ Debenham Tie Leung (戴德梁行).
But Chang yesterday urged construction developers to be patient and refrain from hastily launching new housing projects to flood the market.
Lai, however, said the risk of a property glut was low.
"Around 90 percent of ill-performing construction companies were closed down over the past few years. There is still much room for suppliers to roll out new projects," Lai said.
In response to market concern that price hikes on construction materials will raise property prices, Chang said he believed the impact was limited because price fluctuations in construction materials will only affect pre-sale units.
"These materials, including steel bars, sand and gravel, account for only around 20 percent of the construction costs," he said. "Moreover, most transactions we observed were taking place in existing houses."
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