New mortgages granted by five state-run banks last month reached the highest level since 2016, on the back of robust demand in the property market throughout the second half of last year, central bank data released on Friday showed.
New mortgages granted by Bank of Taiwan (臺灣銀行), Land Bank of Taiwan (土地銀行), Taiwan Cooperative Bank (合作金庫銀行), Hua Nan Commercial Bank (華南銀行) and First Commercial Bank (第一銀行) totaled NT$68.337 billion (US$2.41 billion), up 17.92 percent month-on-month and 13.13 percent year-on-year, the data showed.
This was the highest monthly issuance of mortgages since 2016, when the current integrated house and land sales tax was implemented, the data showed.
For the whole of last year, total new mortgages by the banks totaled NT$629.497 billion, up 6.23 percent from NT$592.553 billion in 2019, the highest in more than a decade.
The growing demand in the property market has driven up housing prices and triggered speculative transactions, especially in the presale property market, which last month prompted the government to introduce new measures to curb speculative transactions.
The new measures include stricter requirements on loans for real-estate buyers and developers, the disclosure of the actual-price registration system for property transactions, restrictions on option agreements for presale housing units, as well as stricter risk control over land and construction financing loans, and industrial land loans to prevent hoarding and speculation.
December is the traditional peak month for property transactions, the central bank said, adding that the measures to curb speculation would in a few months begin to affect the market.
The high number of new mortgages came on the back of a strong housing market in the six special municipalities, it said.
In Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung, housing transactions totaled 26,225 last month, up 6.6 percent month-on-month and 17.5 percent year-on-year, concluding a strong showing in the past two quarters.
Housing transactions in the six cities totaled 250,175 last year, the highest in seven years and up 7.82 percent from 2019, Ministry of the Interior data compiled by the Taiwan Realty Enterprise Group (台灣房屋集團) showed.
Despite rising mortgage demand, the five banks’ average mortgage rate fell to 1.356 percent per year last month, down from 1.361 percent in November last year and 1.608 percent a year earlier, the central bank data showed.
Separately, the five banks’ average lending rates climbed to 1.291 percent last month, up 0.035 percentage points from 1.256 percent in November, the central bank said, attributing the uptick to higher costs for corporate loans.
Capital expenditure loans totaled NT$123.691 billion last month, the highest in 10 years, due to funding demand for corporate investment, and an increase in land and construction loans, the data showed.
The average capital expenditure lending rate was 1.739 percent last month, it showed.
Excluding government loans, the rate would be 1.316 percent, up 0.046 percentage points from 1.270 percent in November, the central bank said.
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