Property: 'Youth Homeownership 3.0' Plan Approved – Real Estate Firms Say Targeted Subsidies for First-Time Buyers Will Stabilize Housing Market

The Executive Yuan approved the 'Youth Homeownership 3.0' mortgage loan plan today (16th), effective from August 1, 2024, to July 31, 2029. Compared to the current 'Youth Homeownership 2.0', the new plan introduces five additional conditions: applicants must be under 50 years old at the time of application; personal annual income must not exceed NT$2 million; property purchase prices are subject to regional caps; increased loan limits for married and parenting households; and both new and existing borrowers under 'Youth Homeownership 2.0' will enjoy a guaranteed three-year interest subsidy period.

Sinyi Realty (9940-TW) stated that the 'Youth Homeownership 3.0' plan extends the subsidy period to 3+3 years, allowing borrowers with a NT$10 million mortgage to save over NT$300,000 in interest over six years compared to standard mortgage rates—making it more favorable than the initial 'Youth Homeownership 2.0'. The new rules apply to borrowers from both 'Youth Homeownership 1.0' and '2.0', broadening the scope of beneficiaries.

Key enhancements in 'Youth Homeownership 3.0' include: - Applicants must be under 50 at the time of application, and the sum of applicant's age and loan term must not exceed 80. - Personal annual income must not exceed NT$2 million. - The appraised or transaction price of the purchased property must not exceed regional thresholds: NT$35 million in Taipei City, NT$25 million in New Taipei City and Hsinchu County/City, and NT$20 million in other counties/cities.

Additionally, loan limits are increased for married and parenting households: households that registered marriage within two years prior to application (newlyweds) qualify for up to NT$12 million; households with minor children qualify for up to NT$15 million.

Chen Jin-ping, Deputy Manager of Evergreen Real Estate Research & Development Center, noted that the new income, price, and age criteria reflect the government's intent to focus limited resources on genuine first-time and owner-occupier buyers. This approach helps mitigate indirect market price distortions and steers the housing market back toward fundamental supply-demand dynamics. She emphasized that the policy direction now prioritizes 'targeted subsidies, promoting owner-occupancy, and preventing resource misallocation'.

Chen added that the property price caps across counties are unlikely to significantly impact overall market transactions. According to Evergreen Real Estate Group's data, over 70% of transactions in the seven major metropolitan areas since 2025 fall within the price thresholds, indicating most first-time buyers remain eligible. Meanwhile, higher loan limits for parenting families help alleviate financial pressure for young families, aligning with goals of housing justice and family development.

Chen also noted that post-implementation, market activity may shift further toward mid-to-lower-priced and older properties that meet policy thresholds, while high-end properties will depend more on individual project competitiveness. However, the policy is expected to reshape first-time buyer demand rather than trigger a broad market upswing. With banks maintaining cautious lending and the Central Bank's credit controls ongoing, the market will remain driven by owner-occupier demand, with limited room for speculative activity. Future market performance will hinge more on regional supply-demand balance, product quality, and affordability, with regional divergence expected to persist.

Tseng Jing-de, Project Manager at Sinyi Realty's Research Institute, highlighted that 'Youth Homeownership 3.0' offers better savings than '2.0' did at launch. When 'Youth Homeownership 2.0' was introduced, the floor mortgage rate was around 2.06%, with a subsidized rate of 1.775%. Now, with tighter monetary conditions, standard mortgage rates hover around 2.5%, and the extended 3+3-year subsidy period allows NT$10 million borrowers to save over NT$300,000 in interest—making it a highly impactful policy. The inclusion of '1.0' and '2.0' borrowers under the new rules further expands support.

Regarding concerns about a price surge similar to the 2023 'New Youth Homeownership' launch, Tseng stated that such a scenario is unlikely now. In 2023, market expectations of rising prices drove a buying frenzy, even affecting pre-sale units. However, under the Central Bank's seventh round of credit controls, pre-sales have cooled and transaction volumes have declined. Banks are now more cautious in lending, so 'Youth Homeownership 3.0' is unlikely to spark a new wave of speculative demand. Instead, it will better serve genuine owner-occupier first-time buyers, allowing those in need to take advantage of government support.