Taipei, Aug. 1 (CNA) Housing prices in Taiwan rose in the second quarter, as investors tended to move their money into the housing market due to volatility in the domestic stock market, according to a local realtor.
The Taiwan Housing Price Index stood at 119 in the second quarter of the year, up 1.71 percent from the previous quarter and 4.39 percent from a year ago, according to Taiwan Realty Co.
The real estate agency, which uses housing prices in the first quarter of 2009 as a base period, compiles the quarterly survey based on the general housing market in two cities and counties and the five special municipalities -- Taipei, New Taipei, Taichung, Tainan and Kaohsiung -- around Taiwan.
Of the areas surveyed, Tainan showed the sharpest quarterly index increase, rising 6.14 percent to 121.
A separate measure showing the average of actual transaction prices in Tainan during the quarter increased 6.39 percent to NT$89,900 (US$2,989) per ping, or NT$27,201 per square meter.
Housing prices in Taipei rose a modest 1.63 percent in the quarter, but Taiwan's capital was still the most expensive place in the country to buy a house, with prices averaging NT$518,600 per ping in the second quarter.
The growth in transaction volumes and prices in the residential property market indicated that the luxury tax is now having less of an impact on the market than when it was first introduced in June 2011, said Liu Yi-jong, who was in charge of the survey, at a press briefing Tuesday.
The luxury tax was put in place to curb speculation, which had sent housing prices in northern Taiwan soaring between 2009 to 2011 and made housing for average income earners unaffordable.
It taxes owners of second homes sold within two years of being purchased 10 to 15 percent of the property's sales price.
Liu said the transparency brought by requiring the actual prices of real estate transactions to be made public -- a policy that took effect Wednesday -- will be a more effective way to clamp down on speculation.
Chu Yun-peng, an economist who teaches at National Central University, supported Liu's views, saying the policy is beneficial to the housing market in the long-run.
"It's a huge step forward toward fair housing," Chu said.
(By James Lee)