TAIPEI: Housing transactions in the nation’s municipalities last month saw an annual double-digit percentage decline, with the number of sales falling below 2,000 in Taipei, surprising some analysts who see the strong performance of the local bourse as an indication that consumer confidence is on the rise.
Despite the year-on-year decline, some areas showed a monthly improvement in sales, signaling the market has yet to hit bottom, analysts said.
There were only 1,983 home sales in Taipei last month, down 29 percent from the same period last year, government data show, although the local bourse briefly rose above the 10,000-point mark on large turnover attributed to improving sentiment.
“Last month’s sales in Taipei are a stark contrast with the 5,000 deals per month recorded in bullish times, suggesting the market has yet to stabilize,” Sinyi Realty Inc researcher Tseng Chin-der said.
The soft performance of the nation’s property market also runs counter to the results of surveys in which respondents say they are generally positive about their abilities to purchase durable goods, on the back of low unemployment figures and tangible wage increases.
Property sales were also soft outside Taipei last month, although figures show a mild improvement from March, likely due to price adjustments favorable to consumers.
New Taipei City saw 4,454 property deals last month, a decline of 14 percent year-on-year but a 17 percent uptick from March, city statistics show.
The completion of the construction of new home developments helped boost transactions in the city’s Sijhih and Banciao districts, Taiwan Realty Co said, adding that more relatively affordable homes had come on to the market in the areas.
The property market in Bancio and Tamsui District might continue to find support due to relative affordability and closeness to Taipei, Taiwan Realty said.
There were a total of 3,031 home sales in Taoyuan last month, a fall of 24 percent annually, government data show, as the fever ignited by its administrative upgrade in December last year tapered off.
While the figure in Taoyuan represents a 6.5 percent uptick from March, the room for further improvement is limited, as income tax plans on property gains are set to inhibit buyers’ interest, the broker said.
Uncertainty over the Taoyuan Aerotropolis Project— a multi-billion dollar project to develop land near the airport — is making buyers hesitant, the broker said.
The market in Tainan fell 21 percent year-on-year to 1,529 deals last month, the city’s statistics show, as weak sentiment spread to the southern city where local residents are the main buyers.
The property market would benefit from stimulus measures such as new infrastructure developments, the broker said.
