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Minister lists 3 causes for high realty prices

TAIPEI, Taiwan -- Finance Minister Chang Sheng-ford (張盛和) yesterday attributed the soaring realty prices in Taipei to three causes, namely speculative capital flows, a supply and demand imbalance and market expectations.

The government should find adequate solutions to these issues, which cannot be easily achieved without the cooperative efforts of the Ministry of the Interior, the Central Bank, the Financial Supervisory Commission, the Ministry of Finance and the Ministry of Transportation and Communications, Chang said.

While elaborating on the three causes, Chang said that the Ministry of Finance will do whatever it can as far as countering speculative capital flows.

Chang also said that there has been a lack of supply in Taiwan, and that would-be homebuyers tend to refrain from purchasing properties in Taipei because most expect real estate prices to climb even higher.

If these three problems are properly addressed, the minister said, a positive change will not be impossible.

In response to questions concerning an exodus of capital from the realty market as a result of the government's measures to combat increasing prices, Chang replied by saying that there are always two sides to every policy; therefore, real estate prices should be lowered gradually to preempt disastrous financial consequences.

Ex-Minister Criticizes Deputy Mayor

Former Finance Minister Joseph Lyu (呂桔誠) yesterday attended a Chinese National Association of Industry and Commerce (中華民國工商協進會) event as a guest speaker, during which he criticized Taipei City Deputy Mayor Chang Chin-oh's (張金鶚) goal to decrease real estate prices by 30 percent.

Lyu was quoted as saying that the measure would be disastrous if implemented in a short period of time.

The safer method, said Lyu, would be to take a step-by-step approach so as to give time for the market to digest.

When asked to suggest a more suitable policy, Lyu declined to make further comments.

Public Housing Answer to Rising Costs: Hau

During his attendance at a contract ceremony on behalf of the Taipei City Government yesterday, Taipei Mayor Hau Lung-bin (郝龍斌) shared his ideas on how to deal with the real estate issue.

Hau sign a turnkey project deal with contractor company REIJU Construction, which will be in charge of the Xing Jian Public Retal Housing Project (興建公營出租住宅).

Hau described the project as a method to counter soaring prices.

Public housing, Hau said, will at least provide younger generations with a roof over their heads when housing is not affordable. Young people not being able to afford housing is one of the reasons Deputy Mayor Chang Chin-oh has been avidly negotiating with the central government, the mayor said.

1 Comment
April 25, 2014    happy.chatting@
Rental housing. Really? This is addressing a symptom (young people not having a roof) and not the root cause. Will young people to put money in the black hole of the, rich, rental and construction companies instead of just staying with their parents and saving their money it for better times? Some young people might feel this a natural as they are used to large companies spreading the disease of paying for everything but owning nothing. Besides, not only young people have a problem, many middle class people cannot move on to better houses. This is what stops the flow and thus for young people to find new houses. This is also the root cause of house market problems in other countries. In others words Taiwan should get the house market flowing again and don't bottle up the lower rental end with excess, low quality, rental supply people may not be interested in. Hopefully politicians can revert from making popular announcement for their self-interest in coming elections and instead to move on and take the bull by the horns.
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