TAIPEI (Taiwan News) -- Hua Nan Commercial Bank (華南銀行) executives do not believe the housing market is strong and expect housing prices in Taiwan to fall 3-5 percent this year.
The total value of the bank’s mortgages is NT$480 billion (US$15.5 billion), and it expects the figure to remain flat this year, Liberty Times reported.
Ministry of Interior statistics note that construction permit applications hit a seven-year low in January. Central Bank Governor Perng Fai-nan (彭淮南) told the Legislative Yuan yesterday that while hot money has returned to Taiwan, it has not entered the real estate market. He said, however, “I see the real estate market is okay now.”
Perng noted that more Taiwanese businessmen are repatriating from China and investing in luxury real estate. Taiwan’s wealthiest ranked second in the world in property ownership. However, the prices of luxury properties in Taipei have fallen recently, with the monthly House Price Index (HPI) dropping to levels close to that of four years ago.
Realty housing experts project prices for non-luxury apartments to decline to levels similar to 2005.
Hua Nan is one of five Taiwanese banks considered to be a major indicator of the housing market’s health as the five combine for a 40 percent share of the mortgage market. The other banks are Bank of Taiwan (台灣銀行), Land Bank of Taiwan (土地銀行), Taiwan Cooperative Bank (合作金庫銀行) and First Bank (第一銀行).