Housing Starts Plummet, Xianglin's Lai Cheng-yi: New Homes May Face Shortage in 5 Years
Taiwan's housing starts have significantly decreased, with Lai Cheng-yi of Xianglin Real Estate predicting a shortage of new homes in five years. This is primarily due to rising construction material costs from the Middle East conflict and labor shortages. Data from the Ministry of the Interior shows a substantial increase in construction permit extensions, with 4,890 cases and 45,777 units extended in the first three quarters of 2025, up 82.8% and 54.5% respectively from 2024. Lai suggests the government relax construction loan regulations and accelerate the introduction of migrant workers.
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- 📰 Published: April 9, 2026 at 17:53
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Lai Cheng-yi stated in a press release today that most developers have adopted strategies of "postponing project launches" and "reducing operations." Especially since March this year, the Middle East conflict has led to rising prices and shortages of construction materials. Additionally, the unresolved issue of managing earth and stone disposal in Taiwan, coupled with various county and city governments announcing construction permit extensions, has exacerbated the situation. He suggested that the government relax the loan-to-value ratio for land and construction loans and accelerate the introduction of migrant workers for the construction industry to maintain healthy liquidity in the housing market.
Xianglin Real Estate Research Office indicated that the recent volatile situation in the Middle East has affected global crude oil and shipping logistics, causing prices of oil or natural gas needed for building materials to rise. This has put Taiwan's construction industry, which heavily relies on imported materials such as high-end steel, elevator control components, and special chemical coatings, under pressure from logistics delays and surging costs. Whether it's basic building materials like cement, rebar, copper, and aluminum, or chemical building materials like waterproofing layers and PVC plastic pipes, the validity period of quotes has significantly shortened, further increasing construction costs.
This has also led to uncertainty in material delivery times, difficulty in finding substitute materials, and forced suspension of construction progress. Furthermore, with no complete solutions for the post-disposal issues of earth and stone and limited channels for construction waste disposal, the cost of excavating basements has skyrocketed. As a result, more and more developers prefer to "postpone construction starts" to avoid peak costs, leading to a surge in the number of extended construction permits and housing units.
According to the latest data from the Ministry of the Interior's Real Estate Information Platform database, the total number of extended construction starts nationwide in the first three quarters of 2025 reached 4,890 cases, and the total number of extended housing units was 45,777, representing increases of 82.8% and 54.5% respectively compared to the same period in 2024. Xianglin Real Estate Research Office estimates that the extension situation may further increase from the fourth quarter of 2025 to the first half of this year.
Lai Cheng-yi estimates that in the next five years, the "choices for new homes will be extremely limited," and extending the completion and handover period for pre-sale projects will "become the norm rather than the exception." Projects that originally took three years to complete, if larger in scale, might be extended to four or even five years.
He said that in addition to construction permit extensions and extended construction periods, he suggests the government relax the loan-to-value ratio and controls for land and construction loans, accelerate the introduction of migrant workers, lower the threshold for the construction industry to apply for migrant workers, and simplify cross-site deployment procedures to prioritize labor support for projects nearing completion. At the same time, he urged an immediate suspension of stricter measures for earth and stone flow management, to be re-promoted only after related supporting measures for earth disposal sites are well coordinated. (Editor: Yang Lan-xuan) 1150409
Xianglin Real Estate Research Office indicated that the recent volatile situation in the Middle East has affected global crude oil and shipping logistics, causing prices of oil or natural gas needed for building materials to rise. This has put Taiwan's construction industry, which heavily relies on imported materials such as high-end steel, elevator control components, and special chemical coatings, under pressure from logistics delays and surging costs. Whether it's basic building materials like cement, rebar, copper, and aluminum, or chemical building materials like waterproofing layers and PVC plastic pipes, the validity period of quotes has significantly shortened, further increasing construction costs.
This has also led to uncertainty in material delivery times, difficulty in finding substitute materials, and forced suspension of construction progress. Furthermore, with no complete solutions for the post-disposal issues of earth and stone and limited channels for construction waste disposal, the cost of excavating basements has skyrocketed. As a result, more and more developers prefer to "postpone construction starts" to avoid peak costs, leading to a surge in the number of extended construction permits and housing units.
According to the latest data from the Ministry of the Interior's Real Estate Information Platform database, the total number of extended construction starts nationwide in the first three quarters of 2025 reached 4,890 cases, and the total number of extended housing units was 45,777, representing increases of 82.8% and 54.5% respectively compared to the same period in 2024. Xianglin Real Estate Research Office estimates that the extension situation may further increase from the fourth quarter of 2025 to the first half of this year.
Lai Cheng-yi estimates that in the next five years, the "choices for new homes will be extremely limited," and extending the completion and handover period for pre-sale projects will "become the norm rather than the exception." Projects that originally took three years to complete, if larger in scale, might be extended to four or even five years.
He said that in addition to construction permit extensions and extended construction periods, he suggests the government relax the loan-to-value ratio and controls for land and construction loans, accelerate the introduction of migrant workers, lower the threshold for the construction industry to apply for migrant workers, and simplify cross-site deployment procedures to prioritize labor support for projects nearing completion. At the same time, he urged an immediate suspension of stricter measures for earth and stone flow management, to be re-promoted only after related supporting measures for earth disposal sites are well coordinated. (Editor: Yang Lan-xuan) 1150409
FAQ
What are the main reasons for the decrease in housing starts in Taiwan?
The main reasons include rising and short supply of construction materials due to the Middle East conflict, unresolved domestic earth and stone disposal issues, and government-approved extensions of construction permits.
What is Lai Cheng-yi's prediction for the future housing market?
Lai Cheng-yi predicts that in the next five years, choices for new homes will be extremely limited, and extended completion periods for pre-sale projects will become the norm.