Housing crash imminent?

Urban legend or fact? The truth exposed here.

Housing crash imminent?

Postby Nagunae » Fri Mar 25, 2016 3:24 pm

It seems we're in the midst of a housing price correction. There's no doubt about that. However, I've never believed that there would be a full-blown collapse in housing prices, as many seem to think.

I own a house and have put it on the market with the goal of selling it within a year or so (I'm really in no hurry). So today's news interests me quite a bit:

Perng said he saw no need to keep various mortgage restrictions introduced since June 2010 because they have achieved their purpose of curbing property speculation.

The central bank had subjected houses in Taipei and 15 popular areas of New Taipei City to a mortgage ceiling of 60 percent due to their soaring prices in recent years. The restriction had also extended to multiple home owners and corporate buyers nationwide.

“Housing prices have corrected across the nation, with transactions last year plunging to the lowest level since the technology bubble burst in 2002,” Perng said.

However, the central bank is keeping the 60 percent cap for houses valued at NT$70 million (US$21.39 million) or more in Taipei, NT$60 million in New Taipei City and NT$40 million elsewhere, citing loan overconcentration among lenders.

“Internal data suggest a continued need for credit controls on luxury housings despite a sluggish market,” Perng said.

Luxury housing, especially in the capital, has borne the brunt of tightening measures, particularly a sharp increase in house taxes.

Sinyi Realty Inc (信義房屋), the nation’s only listed real-estate broker, said the loosened credit controls might introduce a healthy dose of confidence to the market without reviving property fever.

“The [central bank’s] sends a message, that the government is suspending policies that are unfavorable to the market,” Sinyi researcher Tseng Chin-der (曾敬德) said, adding that “sentiment should turn from negative to neutral.”

The central bank also scrapped a loan ceiling of 65 percent for land deals.



http://www.taipeitimes.com/News/front/archives/2016/03/25/2003642376
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Nagunae
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