The local property market flashed a "yellow-blue" light in December, indicating sluggish growth but an improvement from the contraction in November, according to real estate market magazine My Housing (????) on Thursday.
Citing a survey, the magazine said that the local housing index rose to 33.3 points in December, up 2.1 from a month earlier, to flash a yellow-blue light on the back of an increase in new housing projects last month.
The magazine uses a five-color system to describe the local property market, with red indicating overheating, yellow-red showing fast growth, green representing stable growth, yellow-blue signaling sluggish growth and blue indicating contraction.
A yellow-blue light indicates a range between 32 and 42 points in the index, while blue light represents a level below 32 points.
Among the six factors in the housing index, the sub-indexes for the launch of pre-sale housing projects and of newly-built housing stood at 6.90 and 6.67 points, respectively, in December, up from 6.17 and 5.00 points in November, the magazine said.
Ho Shih-chang (???), a research manager at the magazine, said that property developers had put their housing projects on sale again in December partly because the local governments cut property taxes.
Developers were also encouraged by the central government's efforts to push for urban renewal by raising floor area ratios, which refers to the ratio of a building's total floor area (gross floor area) to the size of the plot of land on which it is built, Ho said.
He said the increase in newly launched projects boosted the aggregate value of the new projects to more than NT$30 billion (US$939 million) in the fourth quarter of last year, amid increased buying at the end of the quarter, which is usually a peak period in the local property market.
However, other factors in the index such as housing advertisements and transactions stayed little changed in December, the magazine said.
Ho said the local property market has not flashed a green light in three years and remained weak, despite the slight improvement in the December index.
He said it remained to be seen whether buying interest in the local property market would continue after December and the growth would stabilize.
Source: Focus Taiwan News Channel