A meeting of Taiwan’s Bank led to an interest rate hike of 0.25% (1碼). This has led to speculation regarding effects on the Taiwanese housing market. However, historically low rates compared to other developed countries, combined with continuous price increases in what some are calling a historic housing bubble have led to uncontrolled price increases.
Unlike its neighbor Japan, Taiwan has no tax penalty for owners of multiple homes, leading to one of the worst housing crises in Asia as elites control the vast majority of Taiwan’s housing supply, and buy up any excess. This has led to critically short supply despite unceasing development in major cities and suburbs alike, and population growth at virtually nil.
While nominal pricing in Taiwan remains lower than Hong Kong, price multiples relative to income make home purchases in Taiwan one of the most expensive markets in the world. Fortunately for renters, because of the incredibly high vacancy rates, the price to market rent ratio remains one of the lowest in the world.