Property tax revenue for last quarter declined 12 percent year-on-year to NT$6.42 billion (US$210.53 million), as economic weakness and interest rate hikes dampened buying interest, analysts said yesterday.
The retreat was in line with a slowdown in property transactions, but remained the second-highest quarter behind that of the same period a year earlier, Great Home Realty Co (大家房屋) head researcher Mandy Lang (郎美囡) said.
The extension of property taxes to presale contract transfers in July 2021 has bolstered the tax category in the past two years, Lang said.
Photo: CNA
The revisions also expanded the definition of short-term speculation from two years to five years upon resale of real estate, significantly raising the number of taxable cases, she said.
Tainan recorded the steepest decline of 33.8 percent among the six special municipalities, followed by Taipei’s 25.8 percent decrease and Taichung’s 23.8 percent reduction, she said.
However, New Taipei City, Taoyuan and Kaohsiung bucked the trend registering year-on-year property tax gains of 7.7 percent, 10.8 percent and 7.8 percent respectively, she said.
Sellers should have exited the market with small gains or without capital losses unless they bought at record-high prices, Lang said.
Housing prices have soared in Taichung, Tainan and Kaohsiung in the past few years on the back of improving infrastructure and major tech firms’ construction of new manufacturing facilities.
H&B Realty Co (住商不動產) research chief Jessica Hsu (徐佳馨) said she doubted that property tax revenue would continue to climb in the near term, with interest rates rising above 2 percent and bans on the transfer of presale home purchase agreements approaching.
Policymakers have reiterated their intent to facilitate a soft landing on high property prices and might introduce more unfavorable measures to accomplish that goal, Hsu said.
In related news, a high percentage of resold homes in the past two years were exempt from property taxes despite spikes in real-estate prices, Sinyi Realty Co (信義房屋) said.
In 2021, 54,000 resold homes, or 31.55 percent of overall deals, were exempted from property taxes, likely as they were sold due to job relocation, Sinyi Realty research manager Tseng Ching-der (曾敬德) said.
The ratio of exemptions reached 25 percent last year, which was also high in light of steep real-estate price increases in the past few years, Tseng said, citing Ministry of Finance data.
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