As the momentum of mortgage loan balances continues to rise, the Central Bank of Taiwan reported that the outstanding balance for residential loans reached NT$10.8599 trillion in September, marking a year-on-year increase of 11.26%. This growth is the largest since April 2006 and is largely attributed to a surge in new home deliveries. Some projects are bringing in as few as ten units, while others are delivering hundreds, leading to an increase in mortgage balances. Additionally, construction loans, which had previously shown a declining annual growth rate, saw a slight uptick in September with a year-on-year increase of 5.67%, higher than the figures from August.
On September 20, the Central Bank introduced what market experts are calling the most significant round of selective credit controls to date—the seventh wave. These measures are expected to gradually affect the pace of mortgage growth.
A Central Bank official noted that the spike in mortgage balances is closely tied to the influx of new home deliveries. Many of the loans processed by banks in September were for large-scale projects, stemming from new homes delivered a couple of months earlier, leading to a sequential accumulation of loans.
When asked about when this wave of home deliveries might plateau, the official responded that the outstanding loan balances will be influenced by both the number of transactions and housing prices. Notably, the month-over-month growth rates for housing transactions in the six major cities have turned negative in both August and September.
