Should I buy a condo in Hsinchu?

I currently work in the science park. Family is willing to provide up $1500萬 ($15,000,000) cash for the purchase of real estate for my use. If I bought a place at all within the next few months, I would try to get a condo in one of the new high rise buildings along Guanxin Rd. (關新路). This would be about a 20 minute drive to work during rush hour. Guanxin Rd. is a new development in Hsinchu City that is more and more resembling Zhubei, but as far as location goes, much closer to the science park (commute time from Zhubei would be double in rush hour). The Xinzhuang rail station is nearby, which is a 8 minute ride to the Hsinchu HSR station, though trains run only every half hour.

Some considerations:

  • The money is not leaving Taiwan and we have to invest it somewhere. Neither the money nor title to any property bought with it will be under my name.
  • I will probably quit my job in two years and leave Hsinchu (and perhaps Taiwan) for good because better opportunities in my field are elsewhere and I have no love for this city.
  • We could wait for the bubble to pop and buy in Taipei instead. But my family already has a decent sized condo in Taipei.
  • I am currently renting a 7 ping studio for $7500/month, which is a 20 minute WALK to work (Guanxin Rd. is a 20 minute DRIVE and I would need to buy a scooter/car)
  • At $30萬/ping, we could buy a 50 ping place (including car space and facilities, which means the actual apartment is only 25 ping). But new.
  • I don’t have a spouse or kids, so don’t actually need the extra space. But it will feel like an actual home, instead of the dismal place I’m living in now, which feels worse than a college dorm room.

Thoughts?

Man it’s good to have family like that.

Thoughts are what’s the point if you are leaving in two years and your rent is cheap as hell.

But hey if you can get an apartment use out of it and your family has the money to spare why not?

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You’ll likely lose money on that investment, so it would only make sense if you plan on keeping the condo to return to from time to time from abroad. But you said you don’t like Hsinchu, so I don’t see why you’d buy the condo there. It seems like an unnecessary use of money. Find a city in Taiwan you like, investment in property there, and go live in it whenever you’re in town.

You can buy newish apartments for as low as 1.5 mil. in Hsinchu. Why blow 15?

The traffic in the Science Park is so abysmal in the morning that I imagine even a 20 minute drive to work will be a massive impairment of your life quality. If you are ok at the moment and you know that your family will lose money, what is the advantage?

Question is, are we sure the housing prices for this particular area will see any significant drop? The real estate market in the area should be affected by the health of the companies in the science park as much as it affected the price of real estate elsewhere in Taiwan. Given the relative high salaries of science park workers (higher than Taipei office workers), and compared to the price of real estate in Taipei (even though this is some of the most expensive stuff in Hsinchu, it’s still a fifth of the cost of something comparable in Taipei), the price to income ratio in Hsinchu is pretty reasonable. From what I can tell, the buildings in the neighborhood have a decent occupancy rate. If there’s a downward pull, it’s coming from the new construction in Zhubei, once prices start falling.

I would love to buy my own bachelor pad in central Taipei. Problem is, with prices as they are right now, this money would only get me a shoebox. And getting a place in Taipei isn’t urgent for me because my family already has a home there in a prime spot that I could always stay in. Otherwise, I’d be inclined to just wait for the bubble to pop and get something there.

The advantage is that I get a significant improvement in the quality of my dwelling. The cost of rent for this $15 million condo, if I had to rent it, would be $30000 per month (compared to the $7500 I’m paying for my current place).

Where? This is the furthest away from work I’m willing to live.

That makes no financial sense. The cheapest you could pay per month for a 15 million place is over 33,000 a month, assuming you put down 20% down payment and take out a 30-year loan, and that does NOT include interest.

It makes much, much more sense to rent at nearly that price while maintaining your ability to cut clean when the time comes for you to leave, since that will be a matter of years and not a matter of decades.

As for whether prices will drop… Check what you can get for US$500,000 in major US cities, and compare Taiwanese salaries to US salaries. Housing is clearly sold at a very high price here despite typically not being on par with what’s on the market in the US, and the prices keep going up despite Taiwan having one of the world’s fastest-shrinking populations. So again, more housing + fewer people = higher prices??? This is an indication of a bubble.

All around the Baoshan side (Minghu Rd) of the science park is super cheap housing. They over-built there when the park was still growing. Loads of empty apartments with for sale signs. I had a four bedroom apt there for 10,000 a month.

Is this a capital gains on property roll-over, I heard if you reinvest capital gains in property you can postpone capital gains payments. Another OP not being very open with the reasons behind the purchase…anyway, it doesn’t make sense to buy an apartment in Hsinchu when it’s hey-day is probably past and the property bubble is peaking and there are plenty of available cheap places to rent.
But if it has to go into property and somebody in your family wants to do this it would be beneficial to you for a couple of years I guess.

rent there, invest near Kaohsiung and wait on it :slight_smile: thats what i would do with 15 mil.

Question is, are we sure the housing prices for this particular area will see any significant drop? The real estate market in the area should be affected by the health of the companies in the science park as much as it affected the price of real estate elsewhere in Taiwan. Given the relative high salaries of science park workers (higher than Taipei office workers), and compared to the price of real estate in Taipei (even though this is some of the most expensive stuff in Hsinchu, it’s still a fifth of the cost of something comparable in Taipei), the price to income ratio in Hsinchu is pretty reasonable. From what I can tell, the buildings in the neighborhood have a decent occupancy rate. If there’s a downward pull, it’s coming from the new construction in Zhubei, once prices start falling.

I would love to buy my own bachelor pad in central Taipei. Problem is, with prices as they are right now, this money would only get me a shoebox. And getting a place in Taipei isn’t urgent for me because my family already has a home there in a prime spot that I could always stay in. Otherwise, I’d be inclined to just wait for the bubble to pop and get something there.

The advantage is that I get a significant improvement in the quality of my dwelling. The cost of rent for this $15 million condo, if I had to rent it, would be $30000 per month (compared to the $7500 I’m paying for my current place).

Where? This is the furthest away from work I’m willing to live.[/quote]

Two words: unpaid leave.

Yes, everyone wants to invest. Yes, every one says the fun will never end, no way to lose. :ohreally:

How much money is waiting on the sides, ready to jump in? If not a lot, the boom will turn to bust before too long.

That said, the economic rationality of the Taiwan real estate market baffles me. It should have peaked long ago, however the money under the matresses would appear to still be flowing.

My old boss todl me not to bet on rockets, as it’s hard to say exactly when they run out of fuel.

Can you contact me on asme743 at gmail dot com ? I am interested to understand what was your final research.

What bubble?

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Errrrr … .Look at the Calendar.

Darn, 2014!

And that apartment is probably worth 5 to 10 million more now?

His final research led him to buy several dozen condos in Hsinchu and across the island, and now he has as many girlfriends.

Haha, I started reading and saw the post about Apartments for 1.5 million then I noticed the year :rofl:

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In retrospect it would have been a great investment :slight_smile:
I’m regretting not buying years ago. I kept listening to locals and foreigners who insisted it was going to drop in value and chickened out. There are too many rich people here for the housing market to drop that much.