Taiwan acts to cool market
December 11, 2010 - Taiwan
Taiwan is making moves to cool potential over-heating in its markets with talk of a new tax on real estate sold within a year of purchase and plans to revise land valuation rules.
Government officials said that the tax will be aimed at speculators, whereas land valuations will also be revised more regularly to ensure taxes reflect market changes.
However, previous credit tightening measures have failed to curb real estate prices and some analysts remain sceptical.
Prices in Taiwan's capital, Taipei, rose 7% from December 2009 to September 2010, the same month as Taiwan's central bank increased its benchmark interest rate by 0.125% for the second time this year.
Although no time line has been set for introduction of the tax, it could be as high as 30%, the Taipei based Economic Daily News reported, citing an unidentified official at the Ministry of Finance.
Revised land values would published every year, beginning as early as the second half of next year, according to some sources. Previously, land values were revised only every three years.
Plunging interest rates drove prices of residential property prices up by 20% last year in the greater Taipei area up by 20% last year, deterring first time buyers from the market, leading eight partially government-owned banks to offer mortgages at lower interest rates for buyers aged between 20 and 45.
Source: Property Report
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