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進入《TAIPEI TIMES 焦點》 Developers may sit out credit squeeze
NOT CONSTRUCTIVE: Shining Group’s chairman said the central bank’s extension of the restrictions on housing loans would slow construction, particularly of luxury housing
By Crystal Hsu / Staff reporter
New home construction may drop 25 percent annually this year, with developers sitting on the sidelines for the second half after the central bank extended credit controls beyond Greater Taipei to curb soaring housing prices, builders and brokers said yesterday.
“[The value of] new home projects will struggle to hit NT$600 billion [US$20.03 billion] this year, from the previous forecast of between NT$800 billion and NT$1 trillion, as construction companies will stay in the background until the housing regulations drama cools,” Greater Taichung-based Shining Group （鄉林集團） chairman Lai Cheng-i （賴正鎰） said.
Shining Group owns a construction company and operates the luxury hotel Lalu （涵碧樓）.
Lai, who also heads the General Chamber of Commerce （商總）, said his company has slowed spending on advertising and peers would do the same as the government is bound to introduce more squeezes on credit in the run-up to elections in November.
The central bank on Thursday extended selective credit controls to four more districts in New Taipei City and Taoyuan County where prices have risen sharply after the cost of housing in Taipei priced many wishing to buy property out of the market.
The monetary policymaker caps mortgage loans for second homes in Taipei, 17 districts of New Taipei City and 4 in Taoyuan at 60 percent of their market value.
In addition, it set the loan-to-value limit to 50 percent for third homes across the country and tightened luxury housing thresholds to NT$70 million in the capital, NT$60 million in New Taipei City and NT$40 million elsewhere, from NT$80 million for Greater Taipei and NT$50 million in other parts of Taiwan.
Luxury home loans may not exceed 50 percent of their value, from 60 percent previously.
The new credit controls came after the Ministry of Finance recently raised tax burdens on extra homes from 1.5 percent to a maximum of 3.6 percent to make holding extra houses more expensive.
“Property brokers will bear the brunt of the latest tightening measures with transactions already declining due to political instability,” Lai said, adding that builders like Shining Group will delay the launch of new projects, but cash-strained peers may not be able to afford the strategy.
Developers are also expected to avoid building luxury housing, the obvious target of selective credit controls, Lai said.
Sinyi Realty Inc （信義房屋）, the nation’s only listed broker, said the new restrictions aim to discourage property investment, which is frequently blamed for the steep increase in housing prices seen in the past six years.
“The tightening measures will upset the market for a while but will have very limited impact on first-time home purchases, the main driver these days,” Sinyi head researcher Stanley Su （蘇啟榮） said.
Evertrust Rehouse Co （永慶房屋） expects housing prices to hold steady in Greater Taipei, but to come under pressure for a decline in districts with a heavy supply.
新聞來源：TAIPEI TIMES
