The government’s plan to restrict purchases of farmland is driving up selling pressure on investors who helped build hundreds of thousands of luxury homes on farms across Taiwan, but will have difficulty finding buyers, a report by Evertrust Rehouse Co (永慶房屋) said yesterday.
The real-estate broker said that farmhouses for sale surged 70 percent year-on-year in the first four months of this year, compared with a 7 percent increase for residential houses and a 3 percent gain for office space, the report said.
“The figures reflect anxiety on the part of sellers to flee the market,” as the Council of Agriculture plans to limit purchases of farmhouses to farmers, likely starting at the end of next month, Evertrust researcher Andy Huang (黃舒衛) said by telephone.
Under the tightened regulations, only people with agricultural insurance or substantial plans to engage in farming can build or acquire farmhouses.
The plans come amid warnings from civic groups that land available for farming has rapidly dwindled due to property speculation since 2000, when the government lifted a ban limiting farmland to agricultural use.
The past 15 years have seen 7,600 farmhouses built in Yilan County, with its farming area declining by 1,900 hectares, the groups said.
On average, two farmhouses have been sold each day in the past five years, with 60 percent of them resold within three years of being purchased, they said.
In Yilan, property speculation bloomed in 2006 after the completion of the Hsuehshan Tunnel and prompted the Yilan County Government to temporarily suspend reviews of identification of farmers and to stop issuing building permits for farmhouses and farm facilities.
Nationwide, farmhouse deals dropped 37.2 percent to 5,068 last quarter from the previous year, while trading value shrank 52.2 percent to NT$28.64 billion (US$932.66 million), the report said, citing government statistics.
“The market has taken a downturn judging from both transaction volume and prices,” Huang said.
It will be difficult to find buyers for farmhouses, which have been popular as retirement or vacation homes, the report said.
Many buyers have turned farmhouses into bed-and-breakfast inns.
The highest number of farmhouses for sale are in Taichung at 2,863, followed by Hualien at 2,472 and Kaohsiung at 2,279, the report said.
The number is 2,038 in Taoyuan and 1,881 in Yilan County, the report said.
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