Housing transactions could drop to a historical low this year due to expectations of a price drop and a dim economic outlook, even if the central bank eases mortgage terms for luxury homes, Evertrust Rehouse Co (永慶房屋) said yesterday.
The real-estate broker expects housing transactions to total from 245,000 to 255,000 units this year, the lowest in the survey’s history, unless sellers lower prices enough to facilitate deals, Evertrust general manager Yeh Ling-chi (葉凌棋) said.
The forecast represents a 13 percent decline from the 294,277 units recorded last year.
“Further interest rate cuts and eased mortgage terms are unlikely to improve the situation,” Yeh said at a news conference.
The central bank is due to review monetary policy at its quarterly board meeting today and analysts predict the bank could remove credit controls for luxury homes and cut interest rates by another 12.5 basis points in a bid to spur economic growth.
The central bank has capped mortgages at 60 percent of market value for luxury homes worth NT$70 million (US$2.16 million) or more in Taipei, NT$60 million or more in New Taipei City and NT$40 million or more elsewhere. That is 10 percent lower than average home loans.
If the forecast is correct, Evertrust said the central bank would have exhausted its policy tools given that luxury home trading has come to a near standstill, mainly due to drastic increases in prices and holding costs.
The bank has cut interest rates by 0.125 percentage points three times in the past six months, and in March it relaxed mortgage terms for houses in Greater Taipei, for multiple home ownership, and for land financing.
Transactions recovered slightly, but remained 20 percent lower than last year for the January-to-May period, Yeh said, citing government data.
“The market has yet to hit the bottom until the market stabilizes…. The government is unlikely to lend a helping hand by amending property taxes,” Yeh said.
Lower borrowing costs serve only to deepen the stalemate, making sellers more reluctant to adjust prices in the absence of cash pressures, Evertrust spokesman Lin Tai-lung (林泰隆) said.
The inflexibility is slowing transactions. One poll found that 60 percent of respondents expected housing prices to fall, and close to a majority of them were looking at corrections of between 5 and 15 percent, Lin said.
Meanwhile, 64 percent of sellers were willing to set prices slightly lower than the government’s transaction Web site recommends, Lin said.
“That is still not enough to attract buyers,” he said.
PERSISTENT RUMORS: Nvidia’s CEO said the firm is not in talks to sell AI chips to China, but he would welcome a change in US policy barring the activity Nvidia Corp CEO Jensen Huang (黃仁勳) said his company is not in discussions to sell its Blackwell artificial intelligence (AI) chips to Chinese firms, waving off speculation it is trying to engineer a return to the world’s largest semiconductor market. Huang, who arrived in Taiwan yesterday ahead of meetings with longtime partner Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), took the opportunity to clarify recent comments about the US-China AI race. The Nvidia head caused a stir in an interview this week with the Financial Times, in which he was quoted as saying “China will win” the AI race. Huang yesterday said
Nissan Motor Co has agreed to sell its global headquarters in Yokohama for ￥97 billion (US$630 million) to a group sponsored by Taiwanese autoparts maker Minth Group (敏實集團), as the struggling automaker seeks to shore up its financial position. The acquisition is led by a special purchase company managed by KJR Management Ltd, a Japanese real-estate unit of private equity giant KKR & Co, people familiar with the matter said. KJR said it would act as asset manager together with Mizuho Real Estate Management Co. Nissan is undergoing a broad cost-cutting campaign by eliminating jobs and shuttering plants as it grapples
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
MORE WEIGHT: The national weighting was raised in one index while holding steady in two others, while several companies rose or fell in prominence MSCI Inc, a global index provider, has raised Taiwan’s weighting in one of its major indices and left the country’s weighting unchanged in two other indices after a regular index review. In a statement released on Thursday, MSCI said it has upgraded Taiwan’s weighting in the MSCI All-Country World Index by 0.02 percentage points to 2.25 percent, while maintaining the weighting in the MSCI Emerging Markets Index, the most closely watched by foreign institutional investors, at 20.46 percent. Additionally, the index provider has left Taiwan’s weighting in the MSCI All-Country Asia ex-Japan Index unchanged at 23.15 percent. The latest index adjustments are to
RSS