Crystal drop

Home foreclosures drop 20.3% to all-time low

  • By Crystal Hsu / Journalist

A total of 3,389 homes were foreclosed in the first 10 months of this year, down 20.3% year-on-year and the lowest number on record for the period, as distressed properties declined in due to excessive liquidity and low interest rates, analysts said yesterday. .

Great Home Realty Co (大家 房屋) principal researcher Mandy Lang (郎 子 囡) said the results did not surprise her because Taiwan’s real estate market was resilient during the local COVID-19 outbreak, thanks to a healthy economy, low borrowing costs and abundant liquidity.

“Low interest rates help avoid liquidity strain – the main reason for massive sales,” Lang said, adding that homeowners who need cash have little difficulty finding buyers in the market. existing homes, which would explain the sharp drop in supply in the closed market.

The drop in foreclosures reflects better financial planning by homeowners and affirms the health of the real estate market, Lang added.

The number of foreclosed homes reported in New Taipei City fell the most to 34.8% to 583 units, followed by Taipei with a 31% drop to 420 units and Taichung with a 29.5% drop to 285 units, according to government data.

Foreclosed homes in Kaohsiung fell 27.8% to 372 units, while Taoyuan and Tainan fell 23.9% and 16.1% to 440 and 285 units respectively.

Inflation concerns have helped speed up real estate transactions this year, and soaring prices for building materials are certainly helping fuel the unease, Lang said.

Housing prices have risen in Taiwan over the past two years, even though the central bank has tightened credit controls on several occasions, the Ministry of Finance has put in place stricter property tax conditions, and the Ministry of the Interior has banned transfers of pre-sale projects before their official publication.

The authorities are considering new macroprudential measures, including tax increases for several owners.

Interest in buying luxury homes has even increased in Taipei, where rising prices have scared buyers away in recent years, Lang said.

Jessica Hsu (徐佳馨), chief researcher at H&B Realty Co (住 子 不動產), said the stuck market lacks information transparency, which is why the average buyer prefers to sit on the sidelines.

Properties in popular locations priced below market rates would attract multiple bidders who could raise their prices until they are no longer a bargain, Hsu said.

People interested in buying foreclosed homes should do research before acting, she added.

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