Housing prices unlikely to crumble soon: developer
January 16, 2014, 12:10 am TWN
TAIPEI--A real estate developer on Wednesday said that there is no risk of the local property market caving in anytime soon.
Lee Wen-tsao, chairman of Chong Hong Construction Co., said it is hard to predict anything other than the property market bubble is not likely to burst this year.
He noted that when the real estate market bubble burst in the 1990s, the interest rate on housing loans was over 10 percent, while it is only 2 percent at present.
Land prices remain high, while interest rates tend to be low, he said.
The government's luxury tax, which was imposed in 2011 to curb property speculations, was fine-tuned last year, he noted.
If speculators are not anxious to sell their properties, housing prices will not crumble, he said.
The government levies a 15 percent luxury tax on the resale of properties within one year of acquisition. The rate is reduced to 10 percent if such properties are resold between one and two years after acquisition.