Taiwan's real estate market took off after 2020. As the semiconductor industry boomed around TSMC, the world's largest foundry corporations, the so-called "semiconductor money" flowed into the dwellings market. Home prices in the Hsinchu area, where TSMC's headquarters is located, more than doubled in the past five years. Saying it would curb real estate speculation and stabilize home prices, the Taiwan government implemented "Multiple-Home Holding Tax 2.0," which toughened the property tax on owners of multiple homes, starting in Jul. 2024.
The results differed from expectations. The government believed that raising the tax burden would prompt multiple-home owners to put their dwellings on the market and stabilize prices. But with the added weight of high capital gains taxes, landlords chose to hold rather than sell, and some of the increased tax burden was passed on as higher rents, according to analyses. This is why evaluations inside and outside Taiwan say the tougher holding tax led to a transaction decline and rising rents.
Taiwan and Singapore are cited as representative cases of applying progressive tax rates on holding taxes by distinguishing non-owner-occupied and multiple-home owners. Taiwan varies the burden based on the number of dwellings, while Singapore does so based on owner occupancy. Still, both countries apply lower rates to owner-occupied dwellings. Taiwan leaves a certain exit route for landlords who supply dwellings to the rental market. As debate over revising Korea's holding tax resurfaces, some note it is hard to simply import the Taiwan and Singapore models.
◇ Taiwan: transactions down 25% and rents post biggest rise in 28 years
Like Korea, Taiwan has been seen as a country with a heavy real estate transaction tax burden but a relatively low holding tax burden. Recently, however, it changed its system to strengthen holding taxes on non-owner-occupied and multiple-home owners. The top surcharge rate on the multiple-home dwellings tax rose to 4.8% from the previous 3.6%. The loose standards for recognizing owner-occupied dwellings were tightened, and mortgage loan rules were also stiffened.
The government expected that as the tax burden on multiple-home owners grew, the dwellings they held would come onto the market. But the opposite happened in the actual market. In Taiwan, the capital gains tax rate can reach as high as 45% when selling a dwelling held short term. Even though holding taxes went up, the sizable tax due at sale led landlords to choose to hold rather than sell.
Transactions plunged. According to the Central News Agency (CNA) and others, the number of real estate transactions in Taiwan—including dwellings, stores and offices—was 261,308 in 2025, down 25.5% from a year earlier. It was the lowest level in nine years since 2016. The trade-boosting effect the government hoped for did not appear, and the market instead froze.
Rents also rose. Based on Executive Yuan Directorate-General of Budget, Accounting and Statistics figures, tallied by the local real estate industry, Taiwan's dwelling rent index in 2024 climbed 2.45% from the previous year. It was the biggest increase in 28 years. While inflation, repair costs and maintenance fees also had an impact, there is an interpretation that costs were preemptively passed on to tenants following the announcement of holding tax hikes. This shows how tougher holding taxes can translate into burdens for the rental market.
There were also workarounds to reduce the tax burden. Attorney Zeng Jun-wei of Ho-cheng Law Firm said, "Multiple-home owners chose to lower their tax burden not by selling their dwellings but by changing their household registration addresses and adjusting assets within their families."
To ease the shock to the rental market, the Taiwan government introduced a registered rental dwelling system. Even multiple-home owners can cut their dwellings tax rate to 1.2% if they register their dwellings as social housing or public-interest rental dwellings. If they register as general rental dwellings and report rental income, a 1.5%–2.4% rate applies. The approach is to raise taxes overall but apply lower rates to landlords who supply dwellings to the rental market.
◇ Singapore, with a 90% owner-occupancy rate, has a different structure from Korea
Singapore's structure differs from Taiwan's. Singapore imposes high holding taxes on non-owner-occupied rental dwellings but sharply reduces the tax burden on owner-occupied dwellings. It calculates the holding tax based on "annual value" (AV), the expected rental income from renting a dwelling for one year. For owner-occupied dwellings, no tax is charged up to an AV of 12,000 Singapore dollars, after which a 0%–32% progressive tax applies. By contrast, non-owner-occupied dwellings for rental or investment face a higher 12%–36% rate.
Lee Gwan-ok, a professor of real estate at the National University of Singapore Business School, said, "Singapore levies high holding taxes on rental dwellings, but the burden on owner-occupied dwellings is low even among major global cities." Singapore's owner-occupancy rate is around 90%, and 71% of all dwellings are Housing and Development Board (HDB) public housing. Lee said, "Even if rents for rental dwellings rise due to tax pass-through, most tenants are foreigners, so the government's political burden is relatively small," adding, "Korea is different because the share of domestic tenants is high."
Korea's housing structure differs from Singapore's. According to the 2024 Housing Survey, Korea's owner-occupancy rate is 61.4%, and the self-occupancy rate is 58.4%. More than four out of 10 households do not live in a home under their own name. In this situation, imposing high rates on non-owner-occupied rental dwellings could pass the burden on to tenants and raise households' housing costs.
The capital gains tax structures also differ. Singapore has a heavy holding tax burden but, after a certain period, does not levy capital gains taxes regardless of the number of dwellings. In contrast, in Korea, multiple-home owners selling in designated regulation zones can face a top capital gains tax rate of 82.5%. If holding taxes are raised while leaving capital gains burdens intact, landlords are more likely to hold their homes or raise rents rather than sell. Taiwan's case illustrates this point.