Money talks in vision of future for Hanoi's Old Quarter

Gentrification of historic downtown has begun, but residents facing relocation say they've been offered a shabby deal as real estate prices soar

PUBLISHED : Sunday, 16 February, 2014, 5:07am
UPDATED : Sunday, 16 February, 2014, 5:07am


Tourists, hawkers and motorcyclists rub shoulders every morning in the congested alleyways of Hanoi's low-rise Old Quarter, which seems generations away from the office towers and electronics megastores springing up in other parts of the Vietnamese capital.

The quarter's street grid, laid out in the 15th century, is still dominated by dilapidated shops selling everything from brass gongs to bamboo scaffolding.

It is now among Asia's best-preserved urban hubs of traditional commerce - thanks largely to decades of inattention.

The 82-hectare downtown area is crammed with Buddhist temples, pagodas and French colonial shophouses, whose original tiles and peeling yellow paint have become a draw for visitors.

But with property values high, this neighbourhood could change dramatically in the coming years as similar ones already have in Singapore, Shanghai and many other cities.

Authorities want to begin gentrifying the Old Quarter by relocating 6,200 households between this year and 2020. New construction is likely to be a few years away, but some residents have already been relocated.

Some of them are nervous, though not necessarily over the lost history.

They worry about being exiled to the city's dusty margins, and of being forced to accept a bad deal from a government that has generated public discontent across Vietnam by forcing people off their land with compensation far below market rates.

Pham Dinh Tranh, a retired jeweller in the Old Quarter, has watched many of the traditional jewellery workshops of Silver Street slowly morph into cafes and souvenir shops.

The 82-year-old wouldn't mind a change of scene - the Silver Street home he shares with his extended family is cramped and the roof leaks. But he said Hanoi officials would need to make a convincing case for relocation. "We're willing to go, but not if they take this property and resell it for profit," Tranh said.

Vu Thi Hong, an official with the Hanoi government's Old Quarter Housing Relocation Project, said the main goal of the planned relocations was to reduce population density while preserving cultural heritage.

With about 66,000 people, the quarter has a population density of 823 people per hectare - nearly eight times New York's.

One Silver Street temple - formerly occupied by long-term squatters - has been refurbished and opened to the public, with assistance from architectural consultants from the French city of Toulouse.

Hong said compensation for relocations was paid at market rates determined by the government. City planners have not yet decided what will be constructed once current residents are relocated, she added, but new buildings won't exceed three storeys.

She said a few hundred Old Quarter residents had been moved in the last decade from weathered temples and pagodas, and the authorities plan to build an apartment complex on the outskirts of Hanoi to house thousands of others.

"Most who have already been moved say they have a better life now," Hong said, adding that the government pays up to 81 million dong (HK$29,550) per square metre at streetfront properties.

In Hanoi's real estate market, the average transaction price at Old Quarter properties is currently between US$12,500 and US$15,000 per square metre, said property agent Nguyen Son.

That exceeds the average price of US$9,337 per square metre paid at luxury residential properties across Shanghai.

Pham Ba Bao, who was relocated from Silver Street in 2010, is not entirely satisfied with his new situation.

The retired bicycle maker used to live in the temple that has since been refurbished. He said he received 900 million dong and then purchased an apartment about 11 kilometres away for 474 million dong.

"We're happy with this apartment, but we can't make a living," Bao said at his new place, down the street from some petrol storage tanks.

He used to earn up to 300,000 dong per day selling tea outside the temple, but foot traffic in his new location is minimal. He now survives mainly on the 3 million dong per month his daughter-in-law earns as a hairdresser.