Housing Market Expert Predicts Total Collapse of Second-hand Houses in Taiwan
In a recent program, housing market expert Shuai Guo Tou predicted that the second-hand housing market in Taiwan will completely collapse, especially warning against buying in 2025. He further stated that Yang Jinlong will definitely initiate the eighth wave of housing market regulation this year, while cryptocurrency experts have also called for caution, indicating that the overall economic environment is changing. Holding onto properties might result in missed hedging opportunities.
(Background: TSMC shares fall below NT$1,000! Expert Shuai Guo Tou: The “myth” of TSMC-related properties will definitely collapse; sell if you can.)
(Background Supplement: Bitcoin and housing market golden cross: KOLs in the crypto space buying in Taipei, TSMC engineers selling at a loss, new construction starts at a five-year low.)
The Dire State of Taiwan’s Housing Market
The housing prices in Taiwan have been dismal since the Central Bank implemented the seventh wave of selective credit control measures in September last year, leading to a significant cooling of the housing market. Recently, banks have begun conducting “financial assessments” for second-home buyers, where those with annual incomes below NT$1 million are prohibited from buying properties valued over NT$10 million, triggering a freeze in the housing market. Shuai Guo Tou, who claims to be a close associate of Central Bank Governor Yang Jinlong, has been vocal in various programs about the grim prospects for the housing market in 2025, suggesting that the price decline could exceed expectations. He explicitly stated that there will be an eighth wave of regulations, urging the market to anticipate a significant exit of capital from real estate.
Are Second-hand Houses Facing a Total Collapse?
During his appearance on the “After Work Economics” program on Feng Media, housing market expert Shuai Guo Tou warned that the Taiwanese housing market has entered a “bubble phase.” As of today, nearly 1,000 real estate agencies have gone bankrupt, with another thousand expected to close this year, as second-hand houses are predicted to collapse in 2025. He even used the phrase “20% price drop” as a program title.
“There is no reason not to regulate the housing market in 2025. Yang Jinlong cannot refrain from regulation; he needs to maintain his presence. After all, he is a disciple of Peng Huai-nan. The media will not report on interest rate adjustments, but everyone will write about housing regulations. This year, there will definitely be two rounds of regulation. The policy is deflationary for the housing market; prices have risen too much, and the key point is that the market needs to lack liquidity.”
Subsequently, Shuai Guo Tou reiterated in his own live stream that one should not buy second-hand houses in 2025, as the overheating second-hand market will inevitably collapse under the full restrictions on bank loans, while the prices of new constructions will remain under the control of developers, continuing to experience a “slow decline with no significant volume.” However, the overall housing market will face severe challenges in 2025, especially for second-hand houses in the “protein zone.”
Central Bank’s Aggressive Mortgage Tightening Policy
The Central Bank’s aggressive tightening policy on mortgages is closely related to last year’s mortgage balance data. According to Central Bank statistics, last year, the mortgage balance increased by nearly NT$1.05 trillion compared to 2023, with the total scale rising from NT$10 trillion to NT$11.1 trillion. This scale represents growth levels that would normally take 3 to 4 years, prompting the Central Bank to adopt strict regulations last year, resulting in complaints from banks.
Regarding the significant increase, Shuai Guo Tou mentioned on the “Renovation Xiao Wuliao” program that it is largely related to the Taiwanese government’s implementation of the New Qing’an 2.0 policy. Originally, salaried individuals unable to afford NT$10 million homes suddenly found themselves able to do so, causing properties priced at NT$5 million to jump to NT$10 million, and those at NT$10 million to rise to NT$15 million.
With the New Qing’an policy starting in August 2023 and expected to end in 2026, along with a five-year grace period without principal repayment, the pressure from capital controls will continue until 2028, but Shuai Guo Tou also emphasized that after 2027, in light of elections, there may be a new “New Qing’an 3.0” introduced. How the financial market and policies will supply the housing market at that time will pose a significant question.
When Will Housing Prices Decline, and What Should Be Done?
Given the recent state of credit control, the funding crunch for land and property financing is unlikely to ease before August 2028. However, there might be a wave of policy-driven relief and incentives, allowing certain young individuals to purchase homes. An anonymous expert consulted by Dongqu indicated that the period from 2025 to mid-2027 is already very clearly recognized as a period of overall correction in Taiwan’s housing market. If the properties are not located in prime areas, holding onto them may result in further declines.
Experts also noted that although Taiwan’s housing market has remained relatively insulated from global financial trends, significant changes are occurring in the overall economy, which should also be considered in housing market decisions. For example, Trump’s tariffs and policies are creating inflation expectations, while the Federal Reserve is beginning to consider adopting a more accommodative policy in response to a potential economic recession:
“The Federal Reserve recently reversed its stance on ending balance sheet reduction and stated that it is impossible to achieve the inflation target of 2% before 2027, effectively abandoning the previous aggressive rate-cutting script. The market is even anticipating a potential return to QE, indicating that in the medium to short term, assets might expect monetary easing, leading to a notable price increase, likely continuing until the end of Trump’s term.”
Conversely, if housing prices in Taiwan are destined to fall, while the overall economy may have opportunities in the medium term, there are hedging strategies available. For example, profits from the housing market can be realized by either taking small gains or small losses, or by borrowing a manageable amount against the property to invest in the stock market, external assets, or even small purchases of Bitcoin. These are all viable hedging strategies. Before the elections at the end of 2027, prioritizing the transfer of some real estate holdings into stocks, gold, Bitcoin, and other assets could be a better choice.
However, it is crucial to remember that the fluctuations in the housing market and the stock market will inevitably occur in different cycles. Traders may very well encounter simultaneous downturns or upswings in both areas, so it is essential to maintain discipline, clarity of thought, and patience in operations, avoiding excessive leverage to prevent dual losses.
