Housing revenue trade remains strong

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‘RED LIPS’:
Low interest rates make it easier to trade deposits on pre-sale homes, generating profits for many, though regulations can be broken

  • By Crystal Hsu / Journalist

The practice of exchanging pre-order “red slips” for pre-sale housing projects persists amid strong market sentiment, plentiful liquidity and record interest rates, the Home Office said on Friday.

The red slips serve as receipts for down payment for pre-sale housing.

Several local governments conducted inspections on pre-sale projects on Thursday and found that red slips had been exchanged for profit by depositors for 48 out of 56 items, which in one case violated regulations, the ministry said. in a press release.

Photo courtesy of the Ministry of the Interior

Inspections also revealed other violations in 36 projects, including withholding information and sales contracts with insufficient transaction information, he said.

With the introduction of a system of recording actual prices for real estate transactions nationwide and stricter reporting requirements for pre-sale housing transactions on July 1, the government aims to curb the sale of slips. red. Fines for illegal trade in receipts are NT $ 150,000 to NT $ 1 million (US $ 5,408 to US $ 36,054).

In a separate report released Monday last week, the ministry revealed that 882,634 homes were empty in the second half of last year – a historic low of 9.96% since its initial survey in 2009.

The ministry attributed this trend to improved utilization rates.

Unoccupied homes are defined as units that use less than 60 kilowatt-hours of electricity per month.

Among them, 69,581 were newly completed homes that have yet to find buyers, a five-year low and 4.34 percent less than three months earlier, according to the ministry’s first semi-annual report on the occupancy of housing.

Previously, the ministry published the data annually. Releasing the data more frequently is part of the government’s efforts to curb housing hoarding, which pushes up prices and hinders market access for buyers on lower budgets.

New Taipei City had the most unoccupied homes in the country with 131,300, followed by 108,316 in Kaohsiung and 93,291 in Taichung, according to the report.

Kinmen County had the highest share of unoccupied homes at 18.13 percent, followed by 16.29 percent from Yilan and 15.02 percent from Taitung, he said.

Jessica Hsu (徐佳馨), chief researcher at H&B Realty Co (住 子 不動產), said that over the past few years, several landlords have learned to make better use of their unused properties by renting them out.

Young couples increasingly prefer to live alone, which is increasing demand in the rental and real estate markets, she said.

In addition, owners of older apartments are increasingly aware of urban renewal and seek to improve the safety and value of buildings, Hsu added.

These trends have helped reduce the number of unoccupied homes, she said, adding that the government has introduced measures to make house hoarding more expensive.

Several homeowners have to make higher down payments and pay higher taxes on additional properties, she said.

Additional reports by staff writer

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