Hsichih market stuck in the mud

The flood waters may have receded, but the mud and debris brought by Typhoon Xangsane still clog the streets of Hsichih on the outskirts Taipei.

The mud stands as a reminder to homeowners that any plans they might have to sell will remain mired by the impact the town's flood-plagued history has had on property prices.

The regular occurrence of flooding -- combined with an oversupply of units in Hsichih -- has depressed real estate prices. Despite efforts by the government to spur the property market with preferential loans and improved anti-flooding measures, homeowners can expect more bad weather ahead.

Real estate company Evertrust Rehouse (永慶房屋) forecast recently that prices in the hard-hit areas of Hsichih and Keelung will drop by between 15 and 20 percent from prices already considered extremely low.

"Severe flooding in 1997, when the town was inundated three times within 10 days, and again in 1998 dampened buying interest in Hsichih, subsequently pushing down property values," said Chen Yun-ru (陳韻如), analyst at Evertrust.

Hsichih's image as a sinkhole for flood waters was cemented in people's minds during the 1997 flooding, when heavy rains triggered a landslide. The natural disaster partially toppled the foundation of the upscale Lincoln Mansion (林肯大郡) housing complex, killing more than 20 residents.

With the town wedged between the foot of mountains that divide Keelung, Taipei and the Keelung River, Hsichih's location makes it susceptible to flooding when water comes rushing down from the surrounding steep slopes and over the embankments of the river, Chen said.

"In Hokkien, Hsichih has an old nickname: shui fan jiao (水返腳) -- or `water always underfoot,'" Chen said.

For homeowners, this kind of reputation has been damning. Houses and apartments have proven extremely difficult to sell, with more than 5,300 units currently on the market, according to Evertrust's data.

Prices per ping for an apartment in Hsichih are expected to fall to as low as NT$64,000. In Neihu, which is also located on the Keelung River and suffered recent flooding, prices are expected to drop to as low as NT$136,000 per ping.

The only advice Chen could offer homeowners eager to sell is to have patience and hope for a period of one to two years without heavy flooding. By then, Chen said, memories of Hsichih's floods may have faded, perhaps rekindling interest in units located in an area that, on a dry day, can be quite picturesque.

But according to David Lee, (李孟諺) director of the Taipei County Public Works Bureau, relative security from flooding in Hsichih is around five or six years away. That's when an ambitious plan to raise the height of flood walls along the Keelung River bordering the town and install more pumping stations will be completed.

Lee said the new plan, which is estimated to cost NT$50 billion, will supersede another project currently under construction. That project's inadequacies were highlighted by the latest flooding, causing tremendous dissatisfaction among local residents.

"With Typhoon Xansange the water level of the flooding was about two meters higher than the top of the dikes, so people felt very unsafe," Lee said.

Under the current plan, 16 pumping stations and dikes around seven of the Keelung River's tributaries in and near Hsichih should be operational by August.