By: Tsai Yi-chu and Frances Huang
Taipei, July 25 (CNA) Residential property prices in Taiwan are likely to fall by an annual 5-10 percent over the next two years due to a supply glut and weakening affordability, according to a research report.
Taiwan Ratings, a local partner of U.S.-based Standard & Poor’s, said in the report dated June 23 that Taiwan’s property market is expected to encounter downside risks, reversing its sustained growth over the past five years.
Since the 2008 global financial crisis, home prices in Taiwan have increased by an average 90 percent, driven by strong speculative buying, the ratings agency said.
As a result, the high-flying home prices have become increasingly unaffordable to people in Taiwan, which in turn has caused a decline in local property transactions, Taiwan Ratings said. This situation has set the stage for a correction in residential property prices, the report said. [FULL STORY]