2010-07-19
Mortgage Restrictions and Interest Rates Rise
Taiwan’s Central Bank has recently introduced new mortgage restrictions on real estate transactions. From 25 June 2010, any person who has already obtained a real estate loan will only be allowed to apply for a new real estate loan for an amount less than 70% of the total purchase price of a new property and will not be allowed to have interest relief. The new mortgage restrictions also prohibit banks from making additional loans for maintenance, petty cash or other purposes with the same mortgage.
According to the President of the Central Bank, the terms of such restrictions have not yet been decided.
In addition, the Central Bank has taken other measures to prevent property prices from rising, including raising the rediscount rate of 0.125% to 1.375%. This is the first interest rate raise within the past one and a half years. Other Asian countries that have recently raised interest rates include Australia, New Zealand, India and Malaysia.
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