Greater Taipei home prices, sales were down in June

According to the website, Taipei home prices fell 7 percent in June compared to May, while sales dropped by a whopping 50 percent. The situation in Taipei County wasn't any better, with sales falling by 20 percent.

The declines could be down to the initial success of the central bank's speculation clampdown, which entailed raising its discount rate by 0.125 percent and requiring banks to reduce loans to possible speculators, Rakuya said.

Moreover, the central bank has now asked consumer banks to conduct a series of “stress tests” to see how much they can withstand the scenario in which property prices crash.

According to Rakuya, June sales declined by 70 percent for properties in Taipei City's Zhongshan District, which occupies a significant portion of central and northern Taipei and teems with buildings for both businesses and typical homebuyers. Prices meanwhile fell just slightly.

Sales declined by 60 percent for both Beitou District, in northern Taipei, and Wenshan District, in southern Taipei, as investors and homebuyers took a wait-and-see attitude.

As for Taipei County, sales fell by 20 percent, while prices remained about the same. Sales declined by 30 percent in popular metropolises such as Xindian, Zhonghe and Yonghe, and 50 percent in the less populous Danshui and Sanxia.

The only exception is Xinzhuang, where June sales grew 1.2 times from May, due to various positive factors including its easy access to the future MRT Airport Line and record prices paid for local land parcels in recent auctions.

Chi Chien-chi, vice president of Rakuya, advised potential homebuyers to watch out for rate increases, which he said were set to continue into the future. He suggested that people pay at least 30 to 40 percent of the price of the property as down payment to stave off an increase of interest rates in the future.

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