Housing transactions edged up 1.8 percent to 22,841 units in the nation’s six special municipalities last month, but might tumble by double-digit percentage points this month, as a surge in COVID-19 cases has not yet started to affect the market, analysts said on Wednesday.
The market needed more time to digest a sharp decline in buying interest, as Taiwan is reporting more than 80,000 virus cases per day and the daily case count is expected to stay high for a while, said Tseng Ching-der (曾敬德), research manager at Sinyi Realty Inc (信義房屋), Taiwan’s only listed broker.
Last month’s data mainly reflected transactions in April, as the transfer of property usually takes about a month, Tseng said, adding that more working days last month also contributed to the small month-on-month pickup.
Photo: Lam Yik Fei, Bloomberg
Areas hit hard by virus cases would show drastic retreats from this month, in line with diminished business activity, Tseng said, adding that the surge was initially strongest Taipei and New Taipei City, but later spread across Taiwan.
The transaction slump could be worse than during a level 3 COVID-19 alert from May to July last year, even though the government has not banned social gatherings this time, as its strategy has shifted to “living with the virus,” taking cues from the US, Europe and some other Asian nations.
The time lag explained why transactions in Taipei increased 11.7 percent to 3,068 units, in Tainan gained 15.5 percent to 2,233 units and in Kaohsiung advanced 7.6 percent to 3,648 units, Tseng said, citing data from the respective city governments.
The number of transfers in Taoyuan grew 4 percent to 3,833, while transfers in New Taipei City fell 6.4 percent to 5,721 units and weakened 5.1 percent to 4,338 units in Taichung, city government data showed.
Last year, it took the market three months to show the effects of the level 3 alert, Tseng said.
Evertrust Rehouse Co (永慶房屋), Taiwan’s largest real-estate broker by the number of offices, said that the market found resilient support in real demand from first-home buyers and people with relocation needs, despite rising uncertainty.
However, the performance would take a dive this month and beyond, as most prospective buyers are putting off house hunting until the COVID-19 outbreak stabilizes, Evertrust research department deputy head Chen Chin-ping (陳金萍) said.
The cautious sentiment is obvious nationwide, Chen added.
Tseng and Chen agreed that the market would stage a quick comeback once the case numbers go down, giving people confidence to resume normal activity.
That would likely happen late next month, they said, citing health experts.
Policymakers have indicated readiness to loosen quarantine requirements later this month, citing Taiwan’s need to reconnect with the world.
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