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New housing supply falls sharply in 3 northern Taiwan cities

New housing supply falls sharply in 3 northern Taiwan cities

Property developers in three cities in northern Taiwan have been cutting back on their efforts to put up new properties for sale, which resulted in a more than 30 percent year-on-year drop in supply in the first 10 months of the year, according to a real estate market magazine, My Housing.

The magazine said the reduced supply in Taipei, New Taipei and Taoyuan was aimed at preventing a decline in property prices in the currently weak domestic economy, which has hurt buying interest.

The three cities, in particular Taipei, are closely watched by property market observers as a barometer of trends in the wider property market in Taiwan.

My Housing magazine said property developers unveiled NT$726 billion (US$22.13 billion) worth of new housing projects during the January-October period, a drop of more than 30 percent year-on-year and a decline of 40 percent from the same period of 2013.

Ho Shih-chang, a research manager at the magazine, said property developers in northern Taiwan seemed to have reached a tacit agreement to lower new housing supply in an effort to deal with weaker pricing power in a sluggish domestic economy.

Taiwan's government has lowered its 2015 economic growth forecast from 1.56 percent to 1.06 percent. In 2014, Taiwan recorded 3.92 percent economic growth.

In the first 10 months of 2015, the value of new housing projects launched in the country's capital Taipei was NT$144.2 billion, a 37.8 percent year-on-year drop and the steepest among the three cities mentioned, according the magazine.

Among the city's 12 districts, the biggest decline was in the upscale commercial Xinyi area, Ho said, adding that potential luxury housing buyers may have been deterred by the higher taxes in that segment of the market. In New Taipei, the country's most populous city, NT$294.5 billion worth of new housing projects were put on the market in the 10 month period, which represented a decline of 33.8 percent year-on-year, the magazine said. The drop in Taoyuan was 32.1 percent year-on-year to NT$168.8 billion, the magazine reported.

Ho said political uncertainty ahead of the Jan. 16 presidential election may also have contributed to the weakening of the market for new housing properties.

Updated : 2021-09-28 16:19 GMT+08:00