Home ownership is considered an important factor in determining the state of a country’s economy. While the connection between economic well-being and home ownership rates is debatable, in Taiwan and other East Asian societies owning your own house has also a fundamental cultural function.
A large number of Taiwanese people think that home ownership is a prerequisite for marriage. According to a survey, 44% of respondents believe that they should buy a house before marrying. The remaining 56% believe that it is acceptable to get married first and buy a house later.
In both cases, however, buying a house remains a goal for couples in Taiwan. Due to the importance of marriage in Chinese and Taiwanese culture, it is obvious that the affordability of housing is one of the major concerns of many Taiwanese people.
But recent data shows that achieving the goal of home ownership has become increasingly difficult in Taiwan.
According to the Construction and Planning Agency of the Ministry of the Interior, in the Third Quarter of 2016 the average home loan-to-income ratio in Taiwan has reached 38.49%, an increase of 2.4% compared with the previous year. In Taipei City the figure was as high as 63.71%, and in New Taipei City it was 52.33%. This means that a household in the median income bracket must spend half or more of their monthly income to repay their loans on homes purchased in Taipei.
The Ministry of the Interior defines a home loan-to-income ratio of 30% or below as a reasonable debt burden for a household, while a ratio that surpasses 30% means that homes are less affordable for median income households.
Taipei City is the most expensive city in Taiwan in terms of home ownership, followed by New Taipei City. The most affordable areas are Yunlin, Jiayi (Chia-I), Pingdong (Ping-tung) and Jilong (Chi-lung). Jilong’s home loan-to-income ratio is 22.68%, the lowest in Taiwan.
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