The number of foreclosed homes dropped 5.2 percent to 1,901 units in the six special municipalities in the first half of this year, as sufficient liquidity and low interest rates helped avert cash woes, H&B Realty Co (住商不動產) said earlier this week.
The number has been relatively low in the past few years, with cash strain on the part of companies instead of individuals underpinning foreclosed houses, the real-estate broker said.
Presale projects are priced lower than existing homes in some areas, which also dampens buying interest for foreclosed homes, it said.
Taipei saw the fastest growth, with the number of foreclosed houses increasing 26.1 percent from a year earlier to 387 units, H&B said.
Home prices in Taipei remain high, despite a few years of corrections, creating problems for owners to meet mortgage payments, the broker said.
The number of foreclosed homes in Taichung rose 15.6 percent to 262 after property funds flowed to central Taiwan to take advantage of better infrastructure and contributed to poor investment decisions, H&B said, but added that foreclosures fell by between 6.8 percent and 19.2 percent in New Taipei City, Taoyuan, Tainan and Kaohsiung.
Some companies used their real-estate properties as collateral for bank loans that ended up in the foreclosure market after they failed to honor debt payments, H&B head researcher Jessica Hsu (徐佳馨) said.
Companies with cash flow issues should beware of the US-China trade dispute and next year’s presidential elections, factors that could throw their leverage plans into disarray, Hsu said.
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