Taipei, Taiwan: Sales of top-of-the-class luxury homes in Taipei City reached a historic high in March and grew 70 percent from February, indicating the affluent housing market is hotter than ever, said Yung Ching Realty.

Luxury home sales in March was an increase of 25.7 percent from the previous historic high set in March 2008, Yung Ching said, adding that the average transaction price was NT$957,000 ($41,919) a ping, near the NT$1 million level.

Each ping equals 3.3 square meters.

According to Yeh Kuo-hua, analyst with Yung Ching, prices are at a high due to a shortage of luxury apartments in the city.

In 2009, only 1,910 apartments had unit prices of over NT$1 million per ping, accounting for 0.2 percent of total housing in the city, he said.

Of these residential units, only 96 wanted to sell theirs, leading to the shortage in the market, Yeh said.

Many people have inquired about luxury houses in Taipei, especially those in the following districts: Daan, Zhongzheng and Xinyi, as well as in the following areas: Dazhi and Tianmu.

Yung Ching's study further found during the first quarter, 43.8 percent of people put luxury homes as part of their investment portfolios, a growth from the 13.5 percent for the fourth quarter of last year.

Separately, a study by another brokerage chain, H&B Business Group, found negotiating on home prices is at its hardest right now.

H&B's survey found in April, closing prices and offering prices for used homes in the Greater Taipei Area vary by 10.4 percent, a significant drop from the 18.1 percent for the first quarter last year.

“The area has increasingly become a seller's market,” said Hsu Chia-hsin, analyst with H&B.

She attributed the phenomenon to a continued loose monetary policy taken by Taiwan's central bank.

The central bank at the end of March decided to keep interest rates and banks' required reserve ratio unchanged.

“The market immediately turned bullish,” Hsu said.

“It stands to reason the central bank did what it did to stimulate Taiwan's economy. Yet its action gave a major boost to the housing market.”

According to Hsu, right now many people are literally begging to buy houses, fearing that they will no longer be able to in the future when prices go up further.

This has caused sellers to toughen up during price negotiations, she said.