Transactions of luxury residential housing in Taipei for 2016 are expected to fall more than 50 percent from the previous year amid lingering caution over the local property market, according to H&B Business Group (住商不動產).
H&B said that so far this year, transactions in 2016 of luxury homes in Taipei — the most closely watched property market in Taiwan — dropped sharply from 314 units for the whole of 2015 to 152.
With the current year approaching an end, transactions of luxury homes carrying a price tag of no less than NT$80 million (US$2.5 million) in Taipei for the whole of 2016 are expected to be more than halved from a year earlier.
Hsu Chia-hsin (徐佳馨), head of research at H&B, said that recent efforts by the government to curb skyrocketing home prices in the local market have depressed the luxury home market in Taipei.
Among the government’s measures, a move by the central bank to impose credit control on luxury home-buying to cap bank loans to home buyers, and tax reforms to collect higher capital gains in home sales, have driven many property investors to the sidelines, Hsu said.
The new tax rules took effect Jan. 1 this year, aiming to curb property market speculation by slapping a capital gains tax of up to 45 percent on people who sell their commercial or residential properties within a certain period of time from the date of purchase.
H&B data shows that the value of luxury home transactions in Taipei so far this year fell to NT$20.53 billion, compared with NT$53.95 billion recorded for 2015.
Hsu said that the luxury home market in Taipei hit a recent peak of 377 units in transaction volume and NT$54.45 billion in sales value, but started to witness fading buying interest in 2014, when transaction volume stood at 249, with sales value of NT$41.51 billion.
Transactions in 2015 picked up, with both volume and value rebounding before diving sharply in 2016, Hsu said.
Among the 12 administrative districts of Taipei, Zhongshan District topped its counterparts in luxury home sales in recent years, with transaction volume in the district ranging between 52 and 158 units a year, the H&B data shows.
Hsu said that the relatively high buying interest in the district resulted from property developers’ efforts to launch new projects, in particular in the Dazhi area.
Source: Focus Taiwan News Channel