Taiwan mortgage market shifts as life insurance lending grows

Taiwanese homebuyers are increasingly turning to life insurance companies for mortgages as traditional bank lending becomes more restrictive. Data from the Joint Credit Information Center shows that life insurance mortgage lending grew by 102.7% in the first half of the year, while bank mortgage lending saw a slight decrease of 0.7%.

Experts suggest this shift is driven by the surge in AI-related investments. Banks are prioritizing financing for large electronics corporations to meet high demand, which crowds out individual mortgage applicants. Consequently, some homebuyers are willing to accept higher interest rates from insurance companies to secure necessary funds quickly.

Additionally, challenges persist regarding the Central Bank’s policy for homeowners looking to trade up. While the bank allows an 18-month window to sell old properties, some homeowners face pressure to repay loan differences if sales are not finalized in time. This has led to a conservative lending attitude among banks, with the policy being utilized by only about 5% of restricted loan holders in the first half of the year.