Pressure on builders! Official document reveals a demand for construction materials to "reduce prices by 5-10%", making real estate projects increasingly difficult.

The housing market freeze is spreading to construction sites, and rumors are emerging that builders are demanding a price drop on building materials after years of significant price increases. (Background: Annual salary not reaching 1.5 million! A man from Taichung was advised against applying for a new housing loan by a public bank: You're too poor) (Context: Bitcoin. Housing market golden cross: KOLs in the crypto world buy in Taipei, TSMC engineers sell at a loss, and the volume of construction projects reaches a five-year low) Starting from September 2024, the Central Bank's seventh wave of credit controls suddenly tightened the flow of funds, plunging Taiwan's heated housing market into a 'crackdown period.' Over the past year, it seems that supply and demand have narrowed, and this crackdown is now spreading from reception centers to construction sites. A leaked procurement document shows that several large builders are requesting suppliers to lower their quotes by 5-10%, or they may consider halting work or changing partners. The document states that 'the overall housing market is affected by changes in the macroeconomic environment and the government's ongoing crackdown policies, leading to a conservative sales outlook. End customers like Baojia and Libao are generally starting to adjust and compress budgets for various projects.' Builders are exerting strong cost control and are now asking suppliers to reduce their quotes; some builders are reportedly considering more significant downward adjustments to procurement prices. Buying sentiment is freezing. According to ETtoday Real Estate Cloud reports, after the controls came into effect, credit shrinkage has led buyers to retreat, with Kaohsiung's transaction volume 'dropping by about 70-80%.' However, construction costs have soared in the previous three years: the cost per ping of a 15-story building in the south has surged from NT$120,000 to NT$160,000-180,000, with Taipei even skyrocketing to NT$200,000-250,000. Some building materials have seen price increases of over 100%, and Hong Ping-sen, executive director of the Taiwan Real Estate Development Association, bluntly stated: 'This is the first time in over 40 years of my career that I have seen such an increase.' With sales slowing and bank disbursements delayed, builders are turning back to negotiate prices with upstream suppliers, with rebar, concrete, and electrical work bearing the brunt of the price hikes. The supply chain faces a dual threat. The housing market is just a fuse, but the larger explosive comes from the overall economy. According to TIER's comprehensive construction index, construction activity is expected to decline for several months in early 2025, with the manufacturing sector similarly shrinking. TradingView data shows that output and new orders have plummeted since the end of 2023. The government plans to impose a temporary anti-dumping tariff of up to 70% on Chinese steel materials by mid-2025, further raising procurement costs and disrupting delivery timelines. Under the combined pressure of declining demand and soaring costs, suppliers can only struggle to balance profits and market share. To mitigate risks, builders are adopting prefabrication and modular construction methods, factory-based production shortens construction periods and reduces waste, while cost predictability increases; contracts include shared savings clauses so that subcontractors bear the fluctuations in raw material prices together. On the procurement side, localization strategies are heating up, with local rebar and cement ratios increasing, along with value engineering to replace expensive materials. Digital tools are used to track inventory and scheduling in real-time, driving down logistics and interest burdens. The harsh winter is forcing transformation, and a new ecosystem is emerging. In northern Taiwan, new project volume shrank by 26.8% in the first half of 2025, transaction volume fell over 20%, and the bargaining space expanded to over 9%. However, only high-tech factories are generating localized demand. DIGITIMES points out that AI and semiconductor expansions are driving procurement for concrete and electromechanical materials. Suppliers are shifting towards green materials like energy-saving insulation and solar-integrated panels and controlling risks with short contracts or adjustable pricing mechanisms, while also sharing data with developers to avoid over-preparation. Credit tightening is dragging down the housing market bubble, forcing the construction chain to confront the weaknesses of long-term reliance on price increases. Faced with sluggish sales, manufacturing contractions, and new tariff policies, most companies can only seek outlets through innovation and collaboration. Although the market is cold, prefabrication, digitalization, and low-carbon initiatives are quietly sprouting, which will determine the leaders of the next economic cycle. Related reports: Science Popularization | What are RWA real-world assets? Credit, bonds, real estate... Annual salary not reaching 1.5 million! A man from Taichung was advised against applying for a new housing loan by a public bank: You're too poor. 'The crackdown on builders! Documents exposed demanding that building materials be 'reduced by 5-10%', making real estate projects increasingly difficult.' This article was first published in BlockTempo, the most influential blockchain news media.