Downtown Taipei land sold at record prices

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Published February 27, 2010

Downtown Taipei land sold at record prices


(Taipei)

TAIWAN'S government has sold land in downtown Taipei at record prices, indicating demand for premium housing units amid improving ties with China, the island's biggest property broker said.

A 401 square metre site fetched NT$731 million (S$32 million) at an auction yesterday, after NT$789 million for 384 sq m sold on Jan 28, data from the National Property Administration website showed. These were the highest prices for residential land in Taipei, said Stanley Su, a senior researcher at Sinyi Realty Co.

'These prices indicate optimism for the high-end market,' Mr Su said. 'There's demand, as China-based businessmen and overseas Chinese may be coming back amid strengthening cross-strait relations.'

China and Taiwan plan a trade agreement to reduce import tariffs. The government of President Ma Ying-jeou, who was elected in March 2008 on a platform of improving relations with the island's biggest trading partner, has eased restrictions on investments between banks, brokerages and insurers on the two sides, as well as transportation links.

Revenue from government land auctions last year totalled NT$10.8 billion, according to the Ministry of Finance.

Prices of residential property in the Taipei metropolitan area rose 20 per cent last year after banks cut mortgage rates to the lowest since records began, according to Sinyi Realty.

The central bank has held its key interest rate at a record low of 1.25 per cent in the past 12 months to help boost the economy. Gross domestic product in Taiwan expanded at the fastest pace in five years in the fourth quarter.

Taiwan and China have been ruled separately since Chiang Kai-shek's Kuomintang, or Nationalists, fled to the island after being defeated by Mao Zedong's Communists in 1949. China regards Taiwan as part of its territory. -- Bloomberg