萬國法律事務所

Taiwan's Financial Supervisory Commission (FSC) is once again focusing on housing prices as an FSC official announced a new policy called “the financial supervisory project for land financing”. The first stage of the project will target 10 private larger-scale banks and examine whether there are any flaws in the evaluation process of land as conducted by these banks.

For construction companies, land financing is one of the most important sources of capital, as they use undeveloped land to raise money from banks.

The FSC official stated that there are three major methods used to evaluate the price of land, including reference to the price of land nearby. However, this method tends to be inaccurate as construction companies try to unreasonably inflate the values of nearby lands. As such, the FSC will urge banks to fairly assess the values and then decide on the proper amount of money loaned to construction companies.