|Hong Kong||31 yrs|
Asia: Price/rent ratio
This ratio is typically used for measuring undervaluation/overvaluation of real estate prices, calculated by dividing the gross rental yield by 100 so the higher the yield, the lower the price/rent ratio.
|Last Updated: Apr. 23, 2010|
|TAIPEI - Apartmentts||COST (US$)||YIELD (p.a.)||PRICE/SQ.M. (US$)|
|TO BUY||MONTHLY RENT||TO BUY||MONTHLY RENT|
|40 sq. m.||248,760||529||2.55%||6,219||13.22|
|75 sq. m.||418,725||720||2.06%||5,583||9.60|
|120 sq. m.||630,120||892||1.70%||5,251||7.43|
|200 sq. m.||1,156,800||1,954||2.03%||5,784||9.77|
Anhe Rd , Dunhua Rd, Renai Rd, Tian Mu, Xinyi District
Source: Global Property Guide Definitions: Data FAQ See also: Update Schedule
The values of apartments in Taipei have risen considerably in the past year, mostly due to mainland Chinese buyers, but also due to some appreciation of the Taiwanese Dollar. Average prices of upscale apartments in prime districts have now breached US$5,000 per square metre, and US$6,000 per square metre is more typical for smaller apartments.
Yields on Taiwanese apartments are among the lowest in the world. The owner of an apartment in Taipei will be lucky to realize 2% yields, except on the very smallest apartments. Given that the Global Property Guide’s figures are for gross rental yields, i.e., do not make any allowance for vacant periods, for legal costs, administration costs, cleaning and repairs, rental taxes, property taxes, and other taxes, etc, it is safe to say that landlords in Taiwan earn nothing on their apartments.
We believe apartments in Taipei are overvalued - and will fall in price.