Mortgage interest rates last quarter spiked to a 15-year high of 2.23 percent despite a decline in loan applications, as local lenders slowed real-estate lending to support the central bank’s credit controls, Taiwan Realty Co (台灣房屋) said yesterday.
“The data suggests that buying a home is growing increasingly difficult,” the brokers said, citing data from the Joint Credit Information Center (聯徵中心).
The uptick in mortgage burdens came even though the central bank left its policy rates unchanged in the past two quarters and hiked the lenders’ required reserve ratios to drain money from the market, head researcher Charlene Chang (張旭嵐) said.
Photo: CNA
Further, the monetary policymaker tightened lending terms for non-first houses nationwide to pre-empt a housing bubble, as house loans neared the record high of the financial crisis in 2009.
The average mortgage burden stood at NT$10.43 million (US$320,844) across Taiwan, while the number of mortgages shrank by 6.5 percent, or 4,235, to 60,908 during the July-to-September period, Chang said, adding that mortgage burdens in Taipei are higher at NT$18.32 million, consistent with the capital city’s unaffordable house prices.
The decrease in loan applications showed the selective credit controls succeeded in cooling real-estate lending and the impact would grow more evident this quarter and beyond, Chang said.
It would now take three to four months for lenders to review mortgage applications, from one to one-and-a-half months before the tightening, Sinyi Realty Inc (信義房屋) said, adding that lenders raised borrowing costs to discourage prospective buyers and moderate mortgage operation.
Consequently, the central bank might choose to stay put in its board meeting next week and give the market more time to assimilate to its credit controls, Sinyi said.
The current quarter is traditionally the high season for the housing market, but a slowdown appears inevitable, Taiwan Realty said.
Developers have generally turned conservative about launching presale projects next year and indicated plans to trim price tags in areas with heavy supply, Chang said.
Huaku Development Co (華固建設) said on Wednesday that it and peers would adopt a low-key business approach, a departure from the bull market in the first half of this year.
The strategy suggests a decline in the volume of presale projects and new houses next year, Huaku chairman Chung Jung-chang (鍾榮昌) said, predicting that house prices would hold steady in Taipei and New Taipei City, but would drop 5 percent to 10 percent elsewhere.
Property researcher My Housing Monthly (住展雜誌) said the conservative practices stem from soft demand rather than an attempt to appease the central bank.
Unsold house projects last month soared to 1,017 in northern Taiwan alone, with the most difficulty in Yilan and Taoyuan, the publication said.
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
ADVERSARIES: The new list includes 11 entities in China and one in Taiwan, which is a local branch of Chinese cloud computing firm Inspur Group The US added dozens of entities to a trade blacklist on Tuesday, the US Department of Commerce said, in part to disrupt Beijing’s artificial intelligence (AI) and advanced computing capabilities. The action affects 80 entities from countries including China, the United Arab Emirates and Iran, with the commerce department citing their “activities contrary to US national security and foreign policy.” Those added to the “entity list” are restricted from obtaining US items and technologies without government authorization. “We will not allow adversaries to exploit American technology to bolster their own militaries and threaten American lives,” US Secretary of Commerce Howard Lutnick said. The entities
Minister of Finance Chuang Tsui-yun (莊翠雲) yesterday told lawmakers that she “would not speculate,” but a “response plan” has been prepared in case Taiwan is targeted by US President Donald Trump’s reciprocal tariffs, which are to be announced on Wednesday next week. The Trump administration, including US Secretary of the Treasury Scott Bessent, has said that much of the proposed reciprocal tariffs would focus on the 15 countries that have the highest trade surpluses with the US. Bessent has referred to those countries as the “dirty 15,” but has not named them. Last year, Taiwan’s US$73.9 billion trade surplus with the US
Prices of gasoline and diesel products at domestic gas stations are to fall NT$0.2 and NT$0.1 per liter respectively this week, even though international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices continued rising last week, as the US Energy Information Administration reported a larger-than-expected drop in US commercial crude oil inventories, CPC said in a statement. Based on the company’s floating oil price formula, the cost of crude oil rose 2.38 percent last week from a week earlier, it said. News that US President Donald Trump plans a “secondary