Taiwanese are growing more conservative about housing prices this quarter, with cash and time deposits beating real estate as the most favored investment option after government officials and academics voiced concerns about a housing bubble, a survey by Sinyi Realty Inc (信義房屋) showed recently.
Of the respondents polled in the survey, 33 percent expect housing prices to fall this quarter, a 4 percent rise from the 29 percent recorded last quarter, while the proportion of those with rosy outlooks remained unchanged at 24 percent, Sinyi Realty found.
Meanwhile, the percentage of respondents adopting a neutral stance dropped from 47 to 43 percent, reflecting intensified uncertainty among prospective home buyers and sellers, the nation’s only listed broker said.
“The pessimism is likely to prevail through the Lunar New Year holiday next month, which is a traditional low season for the housing market,” Sinyi researcher Tseng Chin-der (曾進德) said by telephone.
The survey followed comments by Minister of Finance Chang Sheng-ford (張盛和) last month saying that he thinks housing bubbles may be forming across the country after a decade of price rallies.
Financial Supervisory Commission Chairman William Tseng (曾銘宗) shared that sentiment and forecast that some property funds may be diverted to the local bourse as investors seek higher returns.
“Such negative comments serve to weaken sentiment as they suggest unfavorable policy stances that may later translate into action, if necessary,” William Tseng said.
Some candidates in the year-end elections have built their campaigns around making home prices in their districts more affordable after various surveys showed soaring housing prices topping a list of complaints among the public.
This quarter, cash and time deposits have unseated real estate as investors’ most favored investment vehicle, although property remains popular, Tseng Chin-der said.
The survey results showed that home prices in Hsinchu are seen as the most likely to pick up in the next six months, which is a surprise given that Taipei had that title in past polls, Tseng Chin-der said.
The analyst attributed the change to improving profitability among technology firms at the Hsinchu Science Park, often referred to as the country’s “Silicon Valley.”
As of October last year, corporate revenue in the park rose 7 percent annually to NT$924.76 billion (US$30.56 billion), Sinyi said, citing data from the park.
Housing prices have risen about 30 percent in the area for the past five years, which is a relatively modest rate compared with the 70 percent increase in Taoyuan County and 60 percent in central and southern Taiwan, Tseng Chin-der said.
When asked about the elections, 27 percent of the respondents said they would postpone home purchases until after the polls, while a majority said they need more time to form an opinion.
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