On the eve of the implementation of an integrated house and land sales tax to help curb real-estate speculation, the government last week announced it would raise the ceiling for a low-rate mortgage scheme to help young people deal with a housing availability problem.
The Executive Yuan on Thursday approved the Ministry of Finance’s proposal to hike the quota of a preferential home mortgage program for first-time homebuyers between the ages of 20 and 45. Each eligible homebuyer can now apply for up to NT$8 million (US$241,940.36) in loans, an increase from the previous NT$5 million, with the repayment period ranging from 20 years to 30 years.
The ministry said it is necessary to increase the lending because the current limit does not meet the needs of would-be homebuyers, as average housing prices in many urban areas remain high. About 7,290 households are expected to benefit from the increase this year, the ministry said.
Higher preferential mortgages for young people is part of a coordinated effort by government agencies in recent months to keep the property market from cooling down too fast and too deeply to affect the overall economy.
In August, the central bank partially eased its credit controls on property markets in northern Taiwan’s suburban areas to avoid a hard landing. The Financial Supervisory Commission in November agreed to lower the minimum yield required for domestic insurance companies investing in commercial properties from 2.805 percent to 2.555 percent in a move to invigorate the office building market.
The wave of market-friendly policies appear to be good complementary measures to the implementation of the new integrated levy on house and land transfers, which introduces taxes of between 10 percent and 45 percent on property transactions, depending on the duration of ownership.
However, it is hard to predict the effectiveness of those market-friendly measures. Some said they are likely to provide a buffer to absorb a modest level of instability, after the once-booming housing market appeared to have halted abruptly last year; some suspect the government made the moves out of political considerations ahead of the Jan. 16 elections; and others fear the expanded preferential mortgage scheme will just encourage more first-time homebuyers to buy houses and burden themselves with a life-long loan and end up sacrificing their future quality of life.
Young people have been avoiding the housing market in recent years because their job options are limited, they have a variety of debt and are apprehensive about the high cost of housing and the growing gap between rich and poor. In addition, with stagnant wages, the thought of home ownership is increasingly adding stress to young married couples, leading many to consider having fewer children.
Consequently, the problem of Taiwan’s demographic shift — evidenced by a low birthrate and an aging population — will only exacerbate the issues of a small labor force, weakened productivity and slower GDP growth in the long run.
Home ownership is a big commitment and sometimes it is expensive and a life-long burden on personal finances. Even though Taiwan’s housing market has shown signs of slowing recently, home prices are still high in cities — and extremely high in Taipei — where many young people want to live.
If there is anything the government can do to solve the problem of housing affordability and availability, it would create a great opportunity for the younger generation to settle down, attain some type of decent job, start a family, raise children and have extra money to consume and invest.
This would be a strong commitment for the three presidential candidates to make, and one that would get people listening.
Concerns that the US might abandon Taiwan are often overstated. While US President Donald Trump’s handling of Ukraine raised unease in Taiwan, it is crucial to recognize that Taiwan is not Ukraine. Under Trump, the US views Ukraine largely as a European problem, whereas the Indo-Pacific region remains its primary geopolitical focus. Taipei holds immense strategic value for Washington and is unlikely to be treated as a bargaining chip in US-China relations. Trump’s vision of “making America great again” would be directly undermined by any move to abandon Taiwan. Despite the rhetoric of “America First,” the Trump administration understands the necessity of
In an article published on this page on Tuesday, Kaohsiung-based journalist Julien Oeuillet wrote that “legions of people worldwide would care if a disaster occurred in South Korea or Japan, but the same people would not bat an eyelid if Taiwan disappeared.” That is quite a statement. We are constantly reading about the importance of Taiwan Semiconductor Manufacturing Co (TSMC), hailed in Taiwan as the nation’s “silicon shield” protecting it from hostile foreign forces such as the Chinese Communist Party (CCP), and so crucial to the global supply chain for semiconductors that its loss would cost the global economy US$1
US President Donald Trump’s challenge to domestic American economic-political priorities, and abroad to the global balance of power, are not a threat to the security of Taiwan. Trump’s success can go far to contain the real threat — the Chinese Communist Party’s (CCP) surge to hegemony — while offering expanded defensive opportunities for Taiwan. In a stunning affirmation of the CCP policy of “forceful reunification,” an obscene euphemism for the invasion of Taiwan and the destruction of its democracy, on March 13, 2024, the People’s Liberation Army’s (PLA) used Chinese social media platforms to show the first-time linkage of three new
Sasha B. Chhabra’s column (“Michelle Yeoh should no longer be welcome,” March 26, page 8) lamented an Instagram post by renowned actress Michelle Yeoh (楊紫瓊) about her recent visit to “Taipei, China.” It is Chhabra’s opinion that, in response to parroting Beijing’s propaganda about the status of Taiwan, Yeoh should be banned from entering this nation and her films cut off from funding by government-backed agencies, as well as disqualified from competing in the Golden Horse Awards. She and other celebrities, he wrote, must be made to understand “that there are consequences for their actions if they become political pawns of
RSS