The nation’s five major state-run banks extended NT$93.195 billion (US$2.95 billion) of new mortgages last month, the second-highest amount on record, central bank data released yesterday showed.
Total new mortgages extended by Bank of Taiwan (臺灣銀行), Land Bank of Taiwan (土地銀行), Taiwan Cooperative Bank (合作金庫銀行), Hua Nan Commercial Bank (華南銀行) and First Commercial Bank (第一銀行) last month decreased by NT$5.76 billion from a record NT$98.955 billion in the previous month, central bank data showed.
The monthly decline in new mortgages came as December last year was the peak season for delivery of new housing projects, which led to a higher comparison base, the central bank said.
Photo: CNA
Of the new mortgages, preferential housing loans for young people contributed 39.86 percent of the total last month, the highest since August last year — when the government started to provide low-interest mortgage rates for first-times buyers, the data showed.
The preferential housing loan program implemented by the Ministry of Finance increases the maximum loan amount from NT$8 million to NT$10 million and extends the loan period from 30 to 40 years, with the government and state-run banks subsidizing 0.375 percent of the mortgage rates.
The program also extends the grace period for repayment from three years to five years and the interest subsidy scheme is to last for three years until July 31, 2026, the ministry said.
Last month, the average mortgage rate charged by the five state-run banks fell to 2.073 percent, down 0.6 basis points from the previous month, as the preferential housing loan program carries lower mortgage rates, the central bank said.
However, the program has helped support the housing market since August last year, thanks to strong interest from first-time buyers and solid demand for self-occupied homes, it said.
In addition, the central bank said the outlook for the domestic housing market appears positive, given that property transactions in the six special municipalities climbed to 24,999 units last month, up 5.25 percent month-on-month and 98.2 percent year-on-year, citing data released by the six cities — Taipei, New Taipei City, Taoyuan, Taichung, Tainan and Kaohsiung — showed earlier this month.
Meanwhile, the composite index gauging business sentiment in the local property sector rose 0.65 points from a month earlier to 106.49 last month, marking the third consecutive monthly growth, the Taiwan Institute of Economic Research (台灣經濟研究院) reported yesterday, attributing the rise to the preferential home loan program for young people and the local stock market hovering at high levels recently.
Additional reporting by CNA
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