Luxury home prices likely to fall in Greater Taipei in 1st half

Prices of luxury apartments in New Taipei City may go down by 10 percent in the second half while those in the outskirts of Taipei by 5 percent, said Yen Pin-li, general manager of real estate advisor DTZ, yesterday. He made the remarks during a news conference yesterday reviewing the housing industry in the second quarter. He based his prediction on the possible effects of the newest credit control measure launched by the central bank against buyers of posh, upscale apartments. Under the measure, banks are not to provide loans of over 60 percent of prices to buyers of luxury homes, which are defined as those exceeding NT$80 million in total price in Greater Taipei and NT$50 million in other parts of the island. Banks are also not to provide home equity loans, home improvement loans or other types of loans to offer additional money to these people, the central bank stipulated. The measure is an extension of an earlier rule restricting loans to buyers of properties in certain portions of Taipei and New Taipei City. The new measure has been effective in suppressing buying in the luxury home market, Yen said. “In the past, one luxury apartment for sale would bring three groups of potential buyers. Now there is only one,” he said. “Consumer sentiment has waned noticeably.” With no incentives or growth dynamics in the market, prices are expected to go through a correction in the second half, he said.