People who want to buy a home before new taxes take effect need to hurry, as the paperwork takes a long time, a real-estate firm spokesperson said
The nation’s major property brokers last month recorded noticeable rebounds in existing home transactions from the previous month, as sellers sought to close deals before new property taxes take effect next month.
The pick-up came even though next month’s presidential and legislative elections loom — a factor that analysts said usually drives buyers to the sidelines, adding that a lack of uncertainty has helped ease concerns.
“Housing transactions rose between 5 percent and 10 percent in different municipalities [last month], up for the second consecutive month and bucking expectations of a downturn usually seen in the run-up to national elections,” said Tseng Chin-der , a researcher at Sinyi Realty Inc, the nation’s only listed broker.
Tseng attributed the increase to the absence of a competetivie presidential race, as various polls show Democratic Progressive Party presidential candidate Tsai Ing-wen leading the race by a wide margin.
The upcoming integrated levy on land and house transfers gave sellers incentive to lower prices to facilitate sales, Tseng said.
The new property tax introduces taxes of up to 45 percent on gains from properties that are resold within one year of purchase and 35 percent within two years of purchase.
The special sales tax of up to 15 percent on short-term transactions, regardless of losses, is to be abolished next month.
Current tax rates are less strident because they are based on government-set values that are much lower than real prices, Tseng said, adding that sellers lowered prices by 3 percent to 7.5 percent for houses in different parts of the nation last month.
H&B Realty Co and Taiwan Realty Co reported an increase of 11.2 percent and 6.1 percent in housing transactions last month compared with one month earlier.
Price concessions and a willingness to save on tax costs helped boost buying interest, both brokers said.
“People who want to save on taxes need to hurry because going through the paperwork takes time,” H&B spokeswoman Jessica Hsu said, adding that the registration date would determine if people are qualified for existing or new tax rates.
Hsu expects the supply to rise on the back of the abolition of the special sales tax — or better known as the luxury tax. From next month, only people who make gains through the sales of their properties would be subjected to the new property tax.
Evertrust Rehouse Co said they also observed a marked pick-up in transactions last month, linking the upturn to self-occupancy and relocation demand.
Source: http://www.taipeitimes.com/News/biz/archives/2015/12/01/2003633706
