Property transactions in the six special municipalities last month totaled 21,304 units, falling 6.7 percent from one month earlier, as COVID-19 infections and monetary tightening weighed on the market, data from local governments showed.
The figure represented a 15 percent decline from a year earlier, as the market last year received a boost from ample liquidity, low interest rates and stock market rallies, market watchers said.
Taipei was the hardest hit, with the number of transactions reaching 2,452 units last month, a 20.1 percent slump from May and a 17.4 percent retreat from a year earlier, Sinyi Realty Inc (信義房屋) research manager Tseng Ching-der (曾敬德) said.
Residents of Taipei, the nation’s commercial and financial hub, are more sensitive to unfavorable news, Tseng said, added that the market might not come out of the woods any time soon.
New Taipei City fared better with a monthly decline of 5.7 percent and an annual fall of 3.8 percent to 5,394 units, while Taoyuan reported a 4.4 percent monthly fall and a 13.5 percent annual decline to 3,665 units, according to the Web sites of the respective local governments.
Transactions in Taichung weakened 3.4 percent month-on-month and 11.8 percent year-on-year to 4,191 units, while those in Kaohsiung sank 7.9 percent monthly and 20 percent annually to 3,358 units.
The figure in Tainan stood at 2,244 units, a fractional 0.5 percent gain from a month ago, but down 31.2 percent from a year earlier, official data showed.
The poor showings came as little surprise, as last month’s data mostly reflected transactions taking place in May, when the number of daily COVID-19 infections spiked to almost 90,000, Evertrust Rehouse Co (永慶房屋) assistant manager Chen Chin-ping (陳金萍) said.
Expectations of interest rate hikes in Taiwan and abroad deepened the pessimistic sentiment, and the misgivings proved justified, Chen said, as the central bank last month raised interest rates for the second time this year by 0.125 percentage points.
Central bank officials have said the monetary authority might continue to raise rates if inflationary pressures fail to ease.
For the first six months of this year, transactions in the six special municipalities totaled 131,505 units, contracting 2.2 percent from the same period last year, when Taiwan recorded robust GDP growth, record-high stock turnover and ultra-low interest rates, Chen said.
The landscape ahead looks rugged as the Russia-Ukraine war, China’s tight COVID-19 controls and rising global inflation pose serious challenges to Taiwan’s economy, Evertrust said.
The market might end this year with a decline in overall transactions, erasing gains recorded in the first five months, it said.
Taiwan Realty Enterprise Group (台灣房屋集團) section head Charlene Chang (張旭嵐) and Great Home Realty Co (大家房屋) head researcher Mandy Lang (郎美囡) said many home buyers and property investors are still deterred by a series of select credit control measures introduced by the central bank, painting a less rosy picture for local property sales in the second half of this year.
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