Homebuyers expect housing prices to drop next quarter and sellers might need to cut prices by more than 10 percent to facilitate transactions, a quarterly survey released yesterday by Evertrust Rehouse Co (永慶房屋) showed.
Forty-three percent of prospective buyers anticipate housing price corrections in the second quarter, suggesting an increase of 10 percentage points from three months earlier, while people with price hike expectations fell from 32 percent to 26 percent, Evertrust research manager Daniel Chen (陳賜傑) said, citing a survey of 1,239 people between Feb. 21 and March 5.
Chen attributed the sentiment retreat to lingering loan restrictions on the part of domestic lenders and expansive credit controls that the central bank introduced in September last year to cool the market.
Photo: Hsu Yi-ping, Taipei Times
Fifty-seven percent responded that the tightening measures dampened their purchasing interest, with 9 percent ditching purchasing plans altogether, he said.
Housing transactions might total 136,000 to 146,000 units in the first half of this year, shrinking 17 to 23 percent from the same period last year, Evertrust general manager Yeh Ling-chi (葉凌棋) said, adding that deals fell 25 percent in the first two months of this year from the same period last year.
Houses priced below NT$20 million (US$604,504) became mainstream across Taiwan as investors fled the market, leaving first-home buyers and people with real demand to underpin transactions, Yeh said.
A 5 percent to 10 percent price drop would prompt 20 percent of prospective buyers to join the market and a 10 to 15 percent concession would motivate 29 percent of prospective buyers, he said.
“The findings render wild cuts of up to 30 percent on the part of buyers unlikely to close deals,” he said. “A tug of war over house values between sellers and buyers has slowed the market.”
As a result, the number of houses available for sale has spiked by double-digit percentage points across Taiwan for the past six months, he said.
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