Investment Insight - The government's latest policy adjustment excludes the Youth Housing Loan from the real estate loan ratio limit under Article 72-2 of the Banking Act, leading to a surge in the stock prices of construction-related stocks on the Taiwan Stock Exchange!

Recently, a major decision by the government has shocked the real estate market! The Youth Home Loan has been confirmed not to be subject to the regulations of Article 72-2 of the Banking Law, retroactively effective from September 1. This restriction, viewed by the industry as the "tightening spell on real estate lending," has been lifted, immediately triggering a strong rebound in the capital market. Construction stocks surged across the board today (the 4th), with related indices jumping over 6%, and several individual stocks hitting the daily limit. Is this wave of capital just beginning?

This policy adjustment comes at the right time. Taiwan is facing the largest wave of home deliveries in history, and many people applying for new Qing'an loans are at risk of default due to bank quota limitations, which could even trigger a crisis of unsold properties. Senior government officials have previously called on banks to "ease credit," and now there are finally substantive measures in place.

A supervisor from a well-known real estate group's research center pointed out that in recent years, the demand for home loans has rapidly increased due to the stimulus of the new Qing'an loan benefits. The exclusion of quota calculation restrictions not only brings greater flexibility to banking operations but is also a timely blessing for homebuyers waiting for approval. She stated that the average loan approval rate reached a historical high of 2.41% in the second quarter of this year, highlighting that the tightening of funds has raised the cost of home buying.

However, the expert also objectively reminded that the relaxation of the bank law limits does not equate to a comprehensive loosening of the actual lending conditions. Mortgage loans are still constrained by credit assessments, and the loan-to-value limits for multiple property owners still exist. Moreover, only the new Qing'an loans after September are not counted towards the limits, and the amount of funds that can be released in the short term is limited, which may not have a significant impact on the price and volume of the housing market.

With the release of favorable policies, construction stocks immediately surged across the board. During the trading session, stocks of several well-known construction companies hit the upper limit, and the index for listed building materials and construction stocks rarely rose by over 6%, becoming the best-performing sector of the day.

Is the current surge in construction stocks a short-term speculation or the beginning of a long-term trend? Analysts believe that the Taiwanese housing market has long faced the issue of "willing to buy but difficult to obtain loans". Once lending restrictions are relaxed, actual demand is expected to be gradually released. The price trend of construction stocks is already reflecting favorable policies in advance, especially builders adopting the "build first, sell later" model may benefit the most, and future revenue and stock price performance are worth watching.

This policy adjustment is not only expected to alleviate the "mortgage crisis," but it may also inject new vitality into the pre-sale market. As mortgage channels are reopened, the market hopes to bring a turning point to the long-depressed housing market, boosting overall transaction volume. However, banking professionals emphasize that the financial credit assessment standards for borrowers will still be maintained at a certain level, and homebuyers should remain cautious in their financial planning.

| This article declares |
|----------------------------------------------------------------------------------------------------------------------|
| This article only represents the author's personal views and should not be used as a basis for any investment decisions. Readers should seek the advice of a professional financial advisor before making investment decisions to fully understand the associated risks. Leverage products such as Contracts for Difference (CFDs) may result in total loss of principal and are not suitable for all investors, please carefully assess your own risk tolerance. |