Taiwan’s major developers remain positive about their business prospects this year, even though an ongoing COVID-19 outbreak and unfavorable policy measures are dampening buying interest.
Continental Development Corp (CDC, 大陸建設), the property development arm of Continental Holdings Corp (欣陸投控), on Wednesday said that it is planning to go ahead with development projects and land hunting, as it is seeking to support earnings in the next few years.
“The ongoing virus outbreak will be another temporary damper on the housing market,” CDC chief executive officer Liao Tsung-sen (廖淳森) told a news conference in Taipei.
Photo: Hsu Yi-ping, Taipei Times
However, the situation would improve once the COVID-19 situation stabilizes, Liao added.
CDC would this year launch presale projects totaling NT$21 billion (US$714.58 million) and begin offering newly completed housing projects in central locations of Taipei and Taichung, Liao said, adding that the firm is seeking to expand in Taoyuan, Kaohsiung and other markets.
Unfavorable factors such as interest rate hikes and economic uncertainty would not trigger real-estate price corrections, even though investors might have to wait longer to realize gains, he said, citing soaring building material and labor costs.
Huang Hsiang Construction Corp (皇翔建設) said it would continue to thrive on the back of real demand and urban renewal projects.
While building companies generally feel the pinch of inflation, the Taipei-based firm said it is less susceptible because it can hire migrant workers to construct its urban renewal projects.
Urban renewal projects are also not subject to selective credit controls, giving the company more flexibility for financial planning, it said.
Projects available for sale in Taipei, New Taipei City and Taoyuan could generate NT$30 billion in revenue this year, Huang Hsiang said.
Huaku Development Co (華固建設) told its shareholders on Tuesday that the housing market could regain momentum next quarter, even though it is this quarter affected by the virus outbreak and tighter credit controls.
The central bank is expected to raise interest rates for the second time this year at its quarterly board meeting on June 16 to curb inflation.
A considerable number of prospective buyers have retreated to the sidelines, but remain keen to invest in relatively inflation-proof real estate, Huaku said.
Overall transactions might this year shrink slightly compared with last year, but housing prices would hold firm with an upside bias, it said.
Taichung-based Shining Building Business Co (鄉林建設) called on the central bank to pause interest rate increases and credit controls, saying that Taiwan’s economy has showed signs of slowing down and further credit tightening could hurt all sectors.
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