Two out of five Taiwanese companies expect the island’s property market to improve in the first quarter as the economy recovers, twice as many as those forecasting a decline, the government said.
Of the 141 companies surveyed between Nov 12 and Dec 7, 41 per cent said the real-estate market will improve, the interior ministry’s Architecture and Building Research Institute said in a statement yesterday. Twenty per cent of companies said they expected a deterioration.
The real-estate market is bolstered by record-low interest rates and signs Taiwan’s economy is emerging from a recession. Central bank governor Perng Fai-nan said last week the monetary authority will monitor property-price inflation closely.
Home prices may be under ‘huge pressure’ to decline because of oversupply, the government said in yesterday’s statement.
‘People need to be careful while being optimistic about the property market’ as about 12 per cent to 15 per cent of Taiwan’s residential units are vacant, noted Chang Chin-oh, director of the Taiwan Real Estate Research Centre at the National Chengchi University, which produced the survey. He spoke at a press conference in Taipei yesterday.
The central bank has left borrowing costs unchanged at their past four quarterly meetings to help pull the economy out of recession. The island’s gross domestic product (GDP) shrank the least in a year in the three months ended September, and may expand 4.39 per cent next year, according to the Cabinet’s statistics bureau.
Source: Business Times, 29 Dec 2009