Taiwan Real Estate Laws and Regulations

Published on October 29, 2025 and written by Cyril Jarnias

Taiwan Island, located off the southeastern coast of mainland China, is attracting increasing foreign investment thanks to its dynamic economy and promising real estate market. However, before diving into property acquisition in Taiwan, it’s crucial to understand the laws and regulations governing this sector. This article will guide you through the essential aspects of Taiwan’s real estate legal framework, enabling you to make informed decisions for your investment.

Opening the Doors to Taiwanese Real Estate for Foreigners: Myth or Reality?

Contrary to some misconceptions, foreigners do indeed have the right to acquire real estate in Taiwan. However, this right is subject to certain conditions and restrictions that are important to know.

The Taiwanese government has established a system based on reciprocity. This means that nationals of a foreign country can buy real estate in Taiwan if Taiwanese citizens enjoy the same rights in that particular country. This policy aims to encourage foreign investment while protecting national interests.

It’s important to note that certain types of properties are subject to stricter restrictions for foreign buyers. For example, the acquisition of agricultural land or properties located in strategic areas may be limited or prohibited for non-residents. These restrictions aim to preserve national security and protect the country’s agricultural resources.

Despite these limitations, the Taiwanese real estate market remains largely accessible to foreign investors, particularly in major cities like Taipei, New Taipei, Taichung, or Kaohsiung. Apartments, houses, and commercial spaces in these urban areas are generally open for purchase by non-residents, thus offering numerous investment opportunities.

Navigating the Regulatory Jungle: Key Taiwanese Real Estate Laws

The legal framework governing real estate in Taiwan is complex and constantly evolving. Here are the main laws and regulations that every foreign investor should know:

The Land Acquisition by Foreigners Act is the fundamental text governing the rights of non-residents regarding property purchase. It defines the conditions under which foreigners can acquire properties, the types of accessible properties, and the procedures to follow.

The Real Estate Transaction Act regulates all aspects of transactions, from negotiation to the completion of the sale. It notably imposes transparency and information disclosure obligations to protect buyers.

The Real Estate Registration Act governs the property registration process. In Taiwan, registration is mandatory and confers legal ownership of the property. This law details the procedures to follow and the documents required to finalize a transaction.

The Urban Planning Act defines land use and zoning rules. It is crucial for understanding development possibilities and restrictions related to each property.

The Building Act establishes construction and safety standards for all buildings. It is particularly important for investors interested in development or renovation projects.

It is essential to note that these laws are regularly updated to adapt to market developments and societal challenges. For example, recent regulations have been introduced to combat real estate speculation and promote housing access for local residents. These measures include additional taxes on short-term transactions and restrictions on mortgages for investors owning multiple properties.

To effectively navigate this complex regulatory landscape, it is highly recommended to enlist the help of a local lawyer specializing in real estate law. This professional can guide you through the subtleties of Taiwanese legislation and help you avoid potential pitfalls.

Real Estate Taxation in Taiwan: A Major Issue for Investors

Taxation is a crucial aspect of any real estate investment, and Taiwan is no exception. The Taiwanese tax system applied to real estate is relatively complex and can significantly impact your investment’s profitability. Here are the main taxes and fees to consider:

Property tax is an annual tax based on the cadastral value of the property. The rate generally varies between 1% and 3%, depending on the nature and use of the property. Primary residences often benefit from preferential rates.

Real estate capital gains tax applies when selling a property. The rate depends on the holding period of the property and can go up to 45% for sales made within two years of acquisition. This tax aims to discourage short-term speculation.

The real estate transaction tax, introduced in 2016, applies in addition to the capital gains tax. It is calculated on the sale price and varies from 10% to 45%, depending on the holding period and the number of properties owned by the seller.

Transfer fees are due when purchasing a property. They generally amount to 6% of the declared property value.

VAT of 5% applies to the sale of new real estate properties or the first sales of older properties by real estate professionals.

It is important to note that the Taiwanese government has recently strengthened tax measures aimed at cooling the real estate market, particularly in major cities where prices have seen a sharp rise in recent years. These measures include higher tax rates for multiple properties and short-term sales.

For foreign investors, it is also necessary to consider any tax treaties between Taiwan and their country of origin. These agreements can impact the taxation of rental income or capital gains realized in Taiwan.

Given the complexity of the Taiwanese tax system and its frequent changes, it is strongly recommended to consult a local accountant to optimize your tax strategy and ensure you meet all your obligations.

Property Owner Rights in Taiwan: Between Protection and Responsibilities

Property rights are firmly anchored in Taiwanese legislation, offering significant protection to owners, whether local or foreign. However, these rights also come with important responsibilities that should be well understood.

The right of use and enjoyment allows the owner to use their property as they see fit, within the limits set by law. This includes the right to rent the property, renovate it, or modify it, subject to compliance with local urban planning and construction regulations.

The right of disposition authorizes the owner to sell, give, or bequeath their property. For foreign owners, this right may be subject to certain restrictions, particularly regarding minimum holding periods before resale.

Protection against expropriation is guaranteed by the Taiwanese Constitution. If expropriation is necessary for public interest reasons, fair and equitable compensation must be paid to the owner.

In return for these rights, owners have important responsibilities:

Property maintenance is a legal obligation. Owners must maintain their property in good condition and comply with current safety standards.

Compliance with condominium rules is crucial for apartment owners. Decisions made at general condominium meetings are binding and must be respected.

Civil liability of the owner can be incurred in case of damages caused to third parties due to their property. Adequate insurance is therefore strongly recommended.

It is important to note that tenant rights are also well protected by Taiwanese law. Residential leases are subject to strict regulations that govern lease duration, termination conditions, and rent increases. Landlords must be particularly vigilant to respect these rules and avoid any disputes with their tenants.

Finally, it should be mentioned that the Taiwanese government has recently strengthened regulations aimed at protecting real estate buyers. These measures include increased information disclosure obligations by sellers and real estate agents, as well as mandatory cooling-off periods for certain types of transactions.

The Evolution of the Regulatory Landscape: Recent and Upcoming Changes

The regulatory framework for real estate in Taiwan is constantly evolving, reflecting the economic, social, and environmental challenges the country faces. Recent years have seen the introduction of several significant reforms, and more changes are expected in the near future.

The fight against real estate speculation has been at the heart of recent reforms. The government has introduced measures to discourage multiple purchases and quick resales, including:

– An increase in capital gains taxes for short-term sales. – Restrictions on mortgages for investors owning multiple properties. – Strengthened controls on real estate transactions to prevent money laundering.

Improving market transparency is another major focus of recent reforms. New regulations impose more complete disclosure of property information, including transaction history and any structural problems.

Promoting sustainability in the real estate sector is gaining importance. Tax incentives have been implemented to encourage the construction of green buildings and the adoption of energy-saving technologies.

Looking ahead, several regulatory trends are emerging:

A possible increased openness to foreign investors is being considered in certain sectors, particularly to stimulate the development of special economic zones.

Strengthening seismic standards is under study, as Taiwan is located in an active seismic zone. This could lead to additional costs for renovating existing buildings.

Regulation of the rental market could be strengthened, with ongoing discussions about introducing rent controls in certain urban areas.

The digitalization of real estate procedures is underway, with the goal of simplifying transactions and improving traceability.

It is crucial for investors to stay informed about these regulatory developments. Changes can significantly impact investment profitability and long-term strategies.

Conclusion: Successfully Navigating Taiwanese Real Estate

Investing in real estate in Taiwan offers interesting opportunities but requires a thorough understanding of the local legal and regulatory framework. Taiwanese real estate laws and regulations, although complex, aim to create a stable and transparent market, offering protection to both investors and local residents.

To succeed in your real estate investment in Taiwan, it is crucial to:

• Thoroughly understand the specific restrictions applicable to foreign investors
• Stay informed about legislative and tax developments
• Consult local professionals (lawyers, accountants, real estate agents) to benefit from up-to-date expertise
• Carefully plan your tax strategy
• Scrupulously respect your obligations as a property owner

With a cautious and well-informed approach, Taiwanese real estate can offer attractive prospects, both in terms of rental yield and long-term capital appreciation.