Gentrification in Taipei: Kick out the old, bring in the new

Taiwan, like many countries in the 1980s, pursued an economic model of neoliberalism. This was a time when Reaganomics and Thatcherism were in full swing. Many economies were turning away from a Keynesian approach for a more market-oriented economy that would meet its demand with the supply at hand.

Like all economic models, it was supposed to be flawless. However, an economist is someone who can tell you today why his or her theory yesterday was wrong. The gains made by adopting a neoliberalist economic model was an increase in the middle-class.

The counterweight to these gains is that low-income groups in society suffer. One such way they suffer is due to the gentrification of their districts.

Gentrification is a term that means “urban renewal” which has negative connotations. It is the process in which urban neighborhoods are renewed. The knock-on effect is an influx of new affluent residents.

This causes low-income earners and small businesses in the area to take flight to other districts as property prices rise. It has been an issue affecting New York for quite some time with areas in Brooklyn such as Williamsburg and Greenpoint seeing a 79% increase in rent since 2000. Black residents are taking flight from theses areas as gentrification displaces them.

In Taipei, informal residences or settlements, were tolerated by the KMT as a solution to the lack of housing available. According to research conducted by NTU, in 1964, one third of Taipei’s residents lived in these informal settlements, most of which were on state-owned land with public utilities being provided. However, these settlements were soon gentrified under mega-development projects in the 1990s.

With public housing projects being reduced in the 1990s and only benefiting a certain few, the gentrification of informal settlements would create long-lasting problems in Taipei. Even with protests by the Citizen Solidarity against Urban Speculation movement in 1989, the government continued the privatization of public land to developers.

Da’an was gentrified more slowly over time with the first waves occurring the 1990s with mass evictions of residences and the development of ‘high-end’ residencies mostly along Xinyi Road and Xingsheng South Road. This caused local property prices to climb.

The second wave occurred in the mid-2000s with the development of luxurious apartments. The residents were considered squatters because they lived in informal housing.

For decades they were provided public utilities by the government and even had official residency registration, and in a swift move they seen by the law as squatters. With very little public housing available and no alternatives given to those evicted, there have been long-term implications for a community of people left with no options.

Yongkang Street in Da’an was a community that fought back. In 1995, Yongkang Park was planned to be paved over for a road that would alleviate traffic on the weekend for visitors going to Da’an Park. 50 trees were also planned to be removed.

It was quite literally an uprooting of a community that used the park as a community space in an area that was being slowly developed without any plans for the residents and worst of all, without their permission or input.

The Friends of Yongkang park was founded and built up support against the proposed road by contacting the media and gaining support from the community by hosting events in the park. Eventually, with pressure from the media and the community the Planning and Construction Bureaus halted all plans.

Although this speaks truth about how civic engagement can give a voice to a community to prevent its gentrification, it was not able to prevent the area from being gentrified. Walking through the area today, it is not hard to find trendy cafés, bars and shops. It has become a touristy place with crowded streets on the weekend.

It has lost part of itself to give way to gentrification. Although there is still a residential community, many former residencies have been converted into cafés and businesses which accommodate tourists, more so than residents.

Of course, this type of gentrification can be seen all over Taipei. The effect it has had can be visibly seen by Taiwan’s Housing Price Index. From 2001 to 2016, there has been a massive rise in the housing price index, with index points going from 100 in 2001, to nearly 300 in 2016. The index (HPI) is used to measure the price difference in residential housing over time.

Housing prices rising over time is hardly anything to be worried about, but when it is considered that the average and minimum wage have both not shifted upwards relative to the housing price index for the last 10 years, this could be indicative of a bubble in the housing market which is exerting pressure on first time buyers and those who rent.

The Liberty Times has gone so far as to state in 2015, that in order to buy a house, you should not eat or drink for 15 years to help you save enough money to buy property in Taipei. For low to middle income earners, owning property is now too expensive. The development of the city has gentrified it to the point that it is now exclusionary to the very people that it was gentrified for in the first place.

It remains to be seen if there can be enough affordable public housing built in the future and with the effects of gentrification, many residents in Taipei might be pushed to other areas of the city that are less developed. While urban renewal projects can have a positive effect such as the Tamsui River waterfront redevelopment projects, other projects have had an adverse effect on the people it was meant to help.

In Michel Foucault’s insightful book “Madness and Civilization,” he explains that in our modern society, we try to hide or take people with mental illness away from society. Gentrification in this light is a way to hide low-income earners and the homeless from our societies view. If it is out of sight, then it is out of mind for all those except the ones who must be kept away.

Originally published on Taiwan News

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One thought on “Gentrification in Taipei: Kick out the old, bring in the new

  1. Great to find a new fresh blog post about this important subject. Lots can and should be written about housing prices in Taipei.

    For now, though, I’d like to focus on a minor aspect: I’m not sure at all if Taiwan’s business model of the 1980s can be categorized as “neoliberal” in the Reagan-Thatcher sense.

    – It wasn’t “less government”, in fact a byzantine network of government and quasi-official (party, farmers’ associations…) organizations controlled almost all aspects of society.

    – Companies were encouraged to expand, there definitely was a kind of laissez faire attitude (disregard for enviromental damage and other externalities), BUT the economy was also dirigistic in many aspects. The government decided which sectors to foster and subsidize (ITRI, Hsinchu Science Park). Many state monopolies or quasi-monopolies exist to this day (CPC, Taipower). (Back then, probably also Taiwan Tobacco and Liquor Corporation and Taisugar.) Energy and transportations sectors have never been privatized or even liberalized.

    – Government took care that the wealth of the economic boom was distributed relatively equitable, almost every family profited (also a strategy to make people accept authoritarian rule). I think that for a long time wealth distribution in Taiwan was comparable to Scandinavian countries. That only began to change after the millennium, when Chinese manufacturing kicked in and wages in Taiwan began to stagnate.

    Anyway, enjoy your blog and look forward to reading more!


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