The central bank’s board members in September agreed to tighten lending terms to induce a soft landing in the housing market, although some raised doubts that they would achieve the intended effect, the meeting’s minutes released yesterday showed.
The central bank on Sept. 18 introduced harsher loan restrictions for mortgages across Taiwan in the hope of curbing housing speculation and hoarding that could create a bubble and threaten the financial system’s stability.
Toward the aim, it cut the loan-to-value ratio by 10 percent for second and subsequent home mortgages and denied grace periods for first mortgages if applicants already owned other residential properties.
Photo: CNA
One board director said that some people have taken advantage of the grace periods — when borrowers need only pay interest — and resold properties for profit before the grace periods expired, the minutes showed.
The director panned the practice, calling it short-term speculation that has contributed to increases in home prices — making owning a home increasingly unaffordable for people with real demand.
The director said that more forceful measures should be introduced to rein in housing credit, warning that a reversal in housing prices or a hard landing could hurt Taiwan’s financial stability.
First-time mortgage applicants who own multiple residential properties account for nearly 20 percent of applications, the central bank said.
The central bank later backed off and allowed inheritors to qualify for grace periods.
It also removed credit controls for people who have inked home purchase agreements, but have not yet secured bank loans, and for people who need to relocate for family and working reasons, as long as they sell their prior homes within a year.
Another board director said that the latest credit controls were harsher and more expansive, as they extend nationwide, rather than being restricted to the six special municipalities, as well as Hsinchu city and county, the minutes showed.
However, the success of the credit controls remain to be seen, the director said, as not all people in Taiwan need bank credit to advance their property investment plans.
Another board director pressed the central bank to remain watchful for inflation given that house rents continue to rise, with the hikes partly reflecting house price trends.
An increase in interest rates promised a better solution than tightening banks’ required reserve ratios in cooling the housing market, the director said.
To many, Tatu City on the outskirts of Nairobi looks like a success. The first city entirely built by a private company to be operational in east Africa, with about 25,000 people living and working there, it accounts for about two-thirds of all foreign investment in Kenya. Its low-tax status has attracted more than 100 businesses including Heineken, coffee brand Dormans, and the biggest call-center and cold-chain transport firms in the region. However, to some local politicians, Tatu City has looked more like a target for extortion. A parade of governors have demanded land worth millions of dollars in exchange
An Indonesian animated movie is smashing regional box office records and could be set for wider success as it prepares to open beyond the Southeast Asian archipelago’s silver screens. Jumbo — a film based on the adventures of main character, Don, a large orphaned Indonesian boy facing bullying at school — last month became the highest-grossing Southeast Asian animated film, raking in more than US$8 million. Released at the end of March to coincide with the Eid holidays after the Islamic fasting month of Ramadan, the movie has hit 8 million ticket sales, the third-highest in Indonesian cinema history, Film
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
‘IMMENSE SWAY’: The top 50 companies, based on market cap, shape everything from technology to consumer trends, advisory firm Visual Capitalist said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was ranked the 10th-most valuable company globally this year, market information advisory firm Visual Capitalist said. TSMC sat on a market cap of about US$915 billion as of Monday last week, making it the 10th-most valuable company in the world and No. 1 in Asia, the publisher said in its “50 Most Valuable Companies in the World” list. Visual Capitalist described TSMC as the world’s largest dedicated semiconductor foundry operator that rolls out chips for major tech names such as US consumer electronics brand Apple Inc, and artificial intelligence (AI) chip designers Nvidia Corp and Advanced
RSS