COST OF LIVING/Housing transactions in 6 major cities up 26% year-on-year in November

Taipei, Dec. 4 (CNA) Transactions of residential and commercial property in the six special municipalities in Taiwan rose about 26 percent in November from a year earlier, marking the fifth consecutive monthly year-on-year increase on the back of a rise in purchases of newly built homes and the government's preferential mortgage package for young home buyers.

According to statistics released by the six local governments, transactions of homes, shops and offices in Taipei, New Taipei and Taoyuan in the north, Taichung in central Taiwan, and Tainan and Kaohsiung in the south stood at 23,413 units, up 26.1 percent from a year earlier and also up 11.3 percent from a month earlier in November.

Sales of home, shops and offices in the six major cities account for more than 70 percent of total sales in Taiwan.

City by city

Among the six cities, Tainan registered the highest year-on-year growth of 98.6 percent in the month, with the number of transactions hitting 3,198 units, the highest monthly level in 29 months, as new home purchases in certain districts such as Yongkang increased. Tainan sales were also up 18.3 percent from a month earlier.

In Taipei, the most closely watched property market in Taiwan, sales of residential and commercial property rose 22.1 percent from a year earlier and grew 8.1 percent from a month earlier to 2,441 units in November, while transactions in New Taipei, the most populous city in the country, saw transactions rise 42.6 percent from a year earlier and grow 1.5 percent from a month earlier to 6,042 units.

In Taoyuan, sales of homes, shops and offices grew 5.6 percent from a year earlier and rose 14.7 percent from a month earlier to 3,931 units, while sales in Taichung rose 0.3 percent from a year earlier and gained 15.5 percent from a month earlier to 4,299 units.

In addition, transactions in Kaohsiung grew 29.3 percent from a year earlier and rose 18.3 percent from a month earlier to 3,502 units.

Analysis

Lang Mei-nan (郎美囡), a research manager at Great Home Realty, said as the local tech sector appears keen to invest in southern Taiwan, bringing in new residents, home demand increased, leading to an increase in new home purchases, in particular in Tainan and Kaohsiung.

Compared with Taipei, homes in New Taipei were more affordable, attracting buyers for self-dwelling purchases to jump in, adding New Taipei also took advantage of convenient transportation connections with Taipei, making homes in the city more attractive, Lang said.

Chen Ting-chung (陳定中), a senior manager of Taiwan Realty Enterprise, said the fourth quarter is a traditional peak season for the local property market with many home buyers wanting to secure a home to move into before the Lunar New Year holiday, which falls in February 2024.

Many young buyers, Chen said, are benefiting from the government's preferential mortgage program, which has raised the ceiling of mortgages to NT$10 million (US$318,471) from the previous NT$8 million, prompting them to enter the market.

Overall in 2023

However, in the first 11 months of this year, transactions of homes, shops and offices totaled 212,606 units, falling 4.7 percent from a year earlier.

Tseng Ching-der (曾敬德), a research manager with Sinyi Realty Inc., said the decline in the first 11 months reflected a slowdown in the first half of this year in the wake of a rate hike cycle by the central bank to take on inflation, but momentum accelerated in the second half of the year.

Despite the upcoming presidential election slated for Jan. 13, 2024 creating uncertainties in the market, the local property market remains resilient, Tseng said.

The number of transactions around Taiwan is expected to reach about 300,000 units in 2023, the lowest in four years, Chen said.