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The Commercial Times: A visionary housing policy needed

The Commercial Times: A visionary housing policy needed

According to statistics released by the Public Construction Commission in late July, Taiwan's house price-to-income ratio in the first quarter was 7.51 and Taipei's was 14.6, both of which were the lowest in a year and a half. Though the ratios fell slightly, however, home prices are still far beyond the reach of many people. A 2011 survey found that soaring housing prices was the top grievance in Taiwan, prompting the government to impose a luxury tax on the sales of second homes to deal with the rising discontent. In July 2013, however, two years after the luxury tax was implemented, the price of the average house had risen to a historical high of NT$278,300 (US$9,597) per ping (3.305 square meters) nationwide. The average price in Taipei was NT$864,200 per ping, up 11.48 percent from the previous quarter and up 19.06 percent year-on-year. Property prices in Taipei are much lower than in Hong Kong or Singapore, but don't forget that Taiwan's salaries have remained stagnant for 15 years. Taipei's house price-to-income ratio set a new high at 15.52 in the first quarter of 2013, even higher than Hong Kong's 14.9, an indication that residential property in Taipei is the least affordable in the world for local residents. Although the ratio edged lower to 14.6 in the first quarter this yearr, it was not because of the government's efforts. The slide was mainly a result of a slowing economy and falling demand. Ahead of local elections in late November, the Ministry of Finance finally decided to propose changes to Taiwan taxes gains on property sales and pledged to build more public housing (for rent only) in response to activists' calls. Judging from long-term trends, it is clear that Taiwan's housing prices are at their peak and facing the risk of a downturn, in part thanks to the measures put forward by the government to curb soaring property prices. It must be remembered, however, that the real-estate industry has long been billed as the locomotive of Taiwan's economy and any downside in the sector could also adversely affect other parts of the economy. The "Snails without Shells" social movement demanding housing justice was launched 25 years ago, but the issue has remained unresolved to this day. It is worth taking time to explore the problem in-depth and should not be dealt for short-term economic expediency or to pick up votes in an election. (Editorial abstract -- Oct. 7, 2014) (By Flor Wang)


Updated : 2021-04-15 14:18 GMT+08:00