New Education Laws Set to Boost Taipei Property Market
11 August 2011
New education laws are to be introduced in Taipei in 2014 which will extend the current nine-year compulsory education to 12 years. In another major change, junior high school students will no longer be required to sit tough entrance exams for senior high schools, as the choice will depend on their home address. This impending change has caused substantial property price increases in the catchment areas of the very best schools.
The new changes were only announced in February by President Ma Ying-jeou, and mean that all private and vocational high schools, and public schools will be tuition free, and students will be able to attend highly ranked high schools without the need of an entrance exam. By 2014 it's expected that this form of enrolment into high schools will account for three quarters of all registrations, and by 2020 this figure will be 85%. Taipei is already undergoing something of a property boom as prices have increased by 12.2% during the last year. This is partially due to low interest rates, and also strengthening trade ties with mainland China. The effects of these impending new laws have meant that property prices in sought-after catchment areas have increased by as much as 100% over the last five years.
However the reputation of desirable schools is often built on word-of-mouth rather than solid data, and according to one Taipei economist this current phenomenon is nothing new as house prices near good schools have always been higher although this trend has been steadily increasing over the last few years.
Taipei survived the recent global economic crisis relatively unscathed, and house prices are currently around 13.2 times the average household income in the city, with mortgage repayments accounting for 54% of disposable income.