I sometimes get annoyed when people who have never been to Taiwan have the perception that it is tantamount to a third world country. Then again i also get annoyed when some Taiwanese claim that Taiwan is a modern oasis. The truth is probably somewhere in between.
It's easy to get lost in all the tall new buildings and the various luxuries and forget that even in Taipei this is not the lives of most people. For most people, life is what you see above. It's crammed into a 5 story concrete walk. These buildings were hastily made all over the country to manage the influx of Chinese who fled China with CKS.
Meaning most are several decades old, this coupled with the poor water pipping work means they are not the best of places to live. Water damage is common, there is no insulation so there is often mildew inside, and walls have cracks all over them from decades of earthquakes. While it is more than impressive that they are all still standing, they are definitely a health risk and I can only assume that they are another reason why people are often sick.
Still, this is the type of place where most people live, and with the ludicrous cost of new apartments, it's where people continue to live, often three generations all in the same apartment. Because it is where they will live for the rest of lives, a common trend is remodeling. The idea being to essentially make it look like a new modern apartment on the inside.
Even with this though you have to be careful. Sometimes people will remodel it with materials that look good but are low quality, and they don't replace the pipes. Meaning that it will quickly fall apart. Usually this is done by people who want to rent it or sell it.
But to be honest, if I ever bought a place, it would probably be a place like this. It's much cheaper to buy an old place and then remodel it the way you want. The best feature though is freedom. The large new buildings come with gyms and common areas, and security guards, but that all comes with a price. An actual monthly fee, but also stipulations on what you can and can't do. On the flip side these old buildings have no fees and no rules.
