Housing
We've been talking about buying an apartment lately, preferably the one we've rented for the past four years. It's a great location in the middle of what is still called the Eastern parts of Taipei although it is more like the center of the city now given how much it has spread towards the eastern suburbs over the past decade or so. It's a fair size for the two of us, around 90 sq.m. with a great big living room where Lady D also has her hair studio. The lighting is superb, because one of the walls is all window, from about one-third up the wall all the way up to the ceiling. Everything is within walking distance here but my job and parks: pubs, bars, restaurants, movie theatres, coffee shops, book stores, CD shops, department stores, subway stop, gym, clothes shops. It is therefore too expensive, which is why we've not considered it before. At the going market rate of NT$320,000 per ping -- a left-over from the Japanese era, a measure equalling two japanese tatami mats or just above 3.3 sq.m. -- this place would run us somewhere upwards of NT$9 million, around US$300,000, but given the location and D's business it might be worth it, although we wouldn't be willing to go above NT$8-8.5 million. That's already stretching it, but buying a flat here means no rent, just a low or non-existent maintenance fee -- NT$500, less than US$20, right now -- which is good when the mortgages are paid off and we are closing in on retirement. It would be great to be living for free in your old age.
D has her business there, we thought we might just as well look into it. The place is old and everyne says plumbing and electric wiring could well be shot and in need of replacement, although we have experienced no problems at all in four years. What's more, because the place has been used as a hair salon for so long, the kitchen and all the rooms have been torn out, making it a big studio apartment with only a small kitchenette, an office and a bathroom without a bath and only a handshower. Someone then "built" two smaller bedrooms by setting up thin partitions. Anyway, we would have to put in a real kitchen and real walls, but that would give us a big living room, a big kitchen and a big bedroom. With the small office, that's all we need. Provided we could afford it, of course.
There are of course other considerations. Because the place is old, it is time to tear it down and build a new house. Which, in fact, they tried to do a couple of years ago, but then there were three or four families who nixed it, because it meant closing their businesses down and moving away for the duration of the construction. Now there's a new law about to be passed, however, which says that it can be done as long as a majority of residents -- don't know how big a majority -- agrees to tear the place down. The law is meant to make it easier to rezone and modernize this sometimes old and delapidated city. The area where we live is slated to be turned into a commercial area instead of residential. That means that for every square meter of floor space, another 8-10 sq.m. can be added. The way things work, this means that the existing owners will double their floor space and get indoor parking for free as well as paid accommodation during the construction period courtesy of the builder for allowing him to make all the profit he can on all the extra floor space he's allowed to add. Free parking is important here in Taipei, where parking your car is so difficult that buying a permanent indoor spot for a normal-sized car will set you back about NT$3 million or a US$100,000 in the middle of the city. Renting one could easily cost you US$300-400 a month. But as far as we know, nothing is decided about any rebuilding yet.
So we asked the landlord and her husband over to discuss it and see what they were asking. I got wary as soon as they opened their mouths. They gave us the whole routine about how she didn't really want to sell the place since she bought it for investment purposes, while he spread it thick telling us how much prices would go up once the house was torn down and rebuilt. And then they made us their magnanimous offer: we could have the place for a cheap NT$15 million, about US$500,000. About twice the going market rate. Because, as he said, when they rebuild the place, we can turn around and sell it for twice that price.
-And when will that be?
-Oh, maybe next year, maybe in 20 years time. But it will happen, that's for sure.
There are laws on how far you can go above the standing market rate to avoid speculation driving up prices, and when we checked the papers before meeting the owner, it said that they could not sell it for more than NT$11 million. If the seller asks too much, the buyer can put the law on them and force them to sell it at hte market rate. But NT$11 million is still too much. Anything abouve NT$8 million would be too much for this place, so why push it?
Ho, hum. Anyone up for buying an already overpriced flat at an inflated, possible, future market rate? We sure won't buy it.
Today is a good day to move into a new house/apartment, and a bad day for getting married.