The nation’s five major state-run banks extended NT$121.739 billion (US$3.80 billion) in new mortgages last month, the highest amount on record and surpassing the NT$100 billion mark for the third consecutive month, central bank data released yesterday showed.
Total new mortgages extended by the 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) last month increased by NT$20.518 billion, or 20.27 percent, from NT$101.221 billion the previous month, central bank data showed.
The monthly increase in new mortgages came as most home buyers tend to strike deals ahead of Ghost Month on the lunar calendar, which began on Aug. 4, resulting in a significant increase in property transactions and housing loans last month, the central bank said.
Photo: CNA
Housing transactions in the six special municipalities last month totaled 26,555 units, a 33.6 percent increase from a year earlier and marking the highest July figure since 2014, data released by local governments earlier this month showed.
In addition, the average mortgage rate charged by the five state-run banks rose 0.003 basis points to 2.187 percent last month from 2.184 percent the previous month, mainly because some banks raised rates for non-first-time home buyers, the central bank said.
The data also showed that preferential loans for first-home buyers under a government program contributed 38.23 percent of the total new mortgages last month, down 2.69 basis points from the previous month, despite that the amount increased from NT$41.42 billion to NT$46.54 billion.
The program has more flexible conditions for loan applications, offers favorable lending terms and sets a lower barrier for young people than a previous similar scheme.
However, it has also drawn wide criticism for rekindling a hot housing market in Taiwan this year.
During the first seven months of this year, the five state-run banks extended NT$672.99 billion of new mortgages, a record for the period and up 84.34 percent from NT$365.08 billion a year earlier, the data showed.
The latest data came after the central bank on Wednesday announced that domestic lenders must come up with self-disciplinary measures by Sept. 6 to limit mortgage operations and prevent an overconcentration of real-estate loans.
It is part of the monetary policymaker’s efforts to cool the housing market after it introduced a new round of credit-control measures last month, as well as hiked lenders’ required reserve ratio by 25 basis points and tightened second-home mortgage terms in June.
Meanwhile, the Ministry of Finance and state-run lenders have also taken actions recently to crack down on abuses of the favorable loan terms intended for first-time home buyers and self-occupancy.
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