Australia house prices fell the most in 16 months last month and face “significant” downside risk as mortgage holidays and government wage subsidies expire in coming months.
Property values in major cities fell 0.8 percent last month, the steepest decline since February last year, CoreLogic Inc data released yesterday showed.
The slide was led by Perth and Melbourne, which is at the center of a new spike in COVID-19 cases that has prompted the government to lock down parts of the city.
Photo: Bloomberg
“Despite the early signs of improved economic activity and a lift in housing turnover, the downside risk remains significant,” CoreLogic head of research Tim Lawless said. “The recent rise of active virus cases in Victoria is a reminder that the potential risk of a second wave remains a stark reality.”
The housing market faces a further test later this year, when current extraordinary levels of government and bank assistance start to wind down.
More than 485,000 home borrowers are on payment holidays, while about 3.5 million workers are on government wage subsidies, with both programs helping avoid the need for forced sales that could push down prices.
The wage subsidies are set to end in September, while banks might also toughen up criteria for borrowers wanting to extend the initial six-month payment deferrals.
“Eventually, the economy and borrowers will need to abide by market forces,” Lawless said. “This is when we could see a rise in mortgage arrears and the potential for a lift in urgent or forced sales.”
While Australia’s relative success in containing the virus means the economy is reopening quicker than in many other countries, the after-effects might linger for years.
A second wave of infections that slows or reverses the reopening could also set back the recovery.
Shares in Taiwan closed at a new high yesterday, the first trading day of the new year, as contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) continued to break records amid an artificial intelligence (AI) boom, dealers said. The TAIEX closed up 386.21 points, or 1.33 percent, at 29,349.81, with turnover totaling NT$648.844 billion (US$20.65 billion). “Judging from a stronger Taiwan dollar against the US dollar, I think foreign institutional investors returned from the holidays and brought funds into the local market,” Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺) said. “Foreign investors just rebuilt their positions with TSMC as their top target,
H200 CHIPS: A source said that Nvidia has asked the Taiwanese company to begin production of additional chips and work is expected to start in the second quarter Nvidia Corp is scrambling to meet demand for its H200 artificial intelligence (AI) chips from Chinese technology companies and has approached contract manufacturer Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to ramp up production, sources said. Chinese technology companies have placed orders for more than 2 million H200 chips for this year, while Nvidia holds just 700,000 units in stock, two of the people said. The exact additional volume Nvidia intends to order from TSMC remains unclear, they said. A third source said that Nvidia has asked TSMC to begin production of the additional chips and work is expected to start in the second
REVENUE PERFORMANCE: Cloud and network products, and electronic components saw strong increases, while smart consumer electronics and computing products fell Hon Hai Precision Industry Co (鴻海精密) yesterday posted 26.51 percent quarterly growth in revenue for last quarter to NT$2.6 trillion (US$82.44 billion), the strongest on record for the period and above expectations, but the company forecast a slight revenue dip this quarter due to seasonal factors. On an annual basis, revenue last quarter grew 22.07 percent, the company said. Analysts on average estimated about NT$2.4 trillion increase. Hon Hai, which assembles servers for Nvidia Corp and iPhones for Apple Inc, is expanding its capacity in the US, adding artificial intelligence (AI) server production in Wisconsin and Texas, where it operates established campuses. This
Garment maker Makalot Industrial Co (聚陽) yesterday reported lower-than-expected fourth-quarter revenue of NT$7.93 billion (US$251.44 million), down 9.48 percent from NT$8.76 billion a year earlier. On a quarterly basis, revenue fell 10.83 percent from NT$8.89 billion, company data showed. The figure was also lower than market expectations of NT$8.05 billion, according to data compiled by Yuanta Securities Investment and Consulting Co (元大投顧), which had projected NT$8.22 billion. Makalot’s revenue this quarter would likely increase by a mid-teens percentage as the industry is entering its high season, Yuanta said. Overall, Makalot’s revenue last year totaled NT$34.43 billion, down 3.08 percent from its record NT$35.52
RSS