HDB’s deficit for FY2022 widens to record S$5.4 billion
THE Housing and Development Board (HDB) reported a net deficit of S$5.4 billion for its financial year 2022, breaking the S$4.4 billion record set in FY2021.
Like in the previous year, the latest net deficit figure was largely due to a shortfall on the public housing programme.
Some S$4.7 billion was spent on the Home Ownership Programme to develop Build-To-Order (BTO) flats, as well as to provide housing subsidies and grants. This was up 22 per cent from its S$3.9 billion expenditure for the programme in FY2021.
“Housing is a cornerstone of our social compact. The government will continue to support Singaporeans in their home ownership journey. In FY2022, we increased our expenditure to keep public housing affordable and accessible for Singaporeans,” said Desmond Lee, Minister for National Development, on Tuesday (Oct 31).
HDB said its expected loss for flats under development in FY2022 was S$2.7 billion, compared with S$2.3 billion in FY2021. This comes as the amount collected from the sale of flats remains lower than the total development cost of BTO flats and housing grants disbursed.
A wider gross loss of S$1.2 billion for sales completed was also posted, almost doubling from the S$659 million loss reported the year prior.
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Excluding studio apartments and flats sold on short leases, HDB completed sales of 18,478 units in FY2022. It marked the highest sales figure in the last five years, as opposed to 13,506 units sold in the previous year.
A lower S$686 million of Central Provident Fund (CPF) housing grants were disbursed to eligible buyers of resale flats and executive condominiums (ECs) for the year, compared with S$849 million in FY2021.
This is in line with the lower number of resale transactions at 27,900 in FY2022 from 30,400 in the previous year, said HDB.
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The board also said it spent about S$141 million to make provisions for rental flats to eligible tenants under various rental housing schemes, up from S$121 million in FY2021.
Another S$558 million was spent on upgrading programmes, up 40 per cent from S$392 million (*see amendment note) in FY2021. The higher expenditure for such programmes was mainly attributed to construction works under the Home Improvement Programme (HIP), which picked up amid the easing of Covid-19 measures.
Under HIP, 33,704 flats were upgraded in FY2022. Over half of residents whose flats underwent HIP also opted for elderly-friendly fittings at subsidised rates under the Enhancement for Active Seniors programme.
HDB spent a further S$432 million for residential ancillary functions including lease administration, provision and management of facilities such as car parks in housing estates, and planning and building administration.
This was partially due to expenditure for the upgrading of electrical supply in HDB estates, as the board said it “caught up on the earlier delays caused by the pandemic”.
HDB added that it remains on track to launch up to 23,000 flats in 2023.
It will continue to monitor the housing demand closely and make necessary adjustments in view of its target to launch a total of 100,000 flats from 2021 to 2025.
“With the significant market discounts and various housing grants, close to 90 per cent of first-timer families have been able to service their housing loans using CPF, with little or no cash outlay,” said HDB.
Ahead of its initiative to introduce a new classification of flats into Standard, Plus and Prime models from the second half of 2024, the board said it will price in additional subsidies for Plus and Prime flats on top of the substantial market discounts given to Standard flats.
“These flats will also come with subsidy recovery, longer MOP (minimum occupation period) as well as tighter conditions for resale and rental, to ensure that subsidised public housing remains fair and inclusive for Singaporeans today, and in the future.”
Amendment note: This article has been revised to reflect the correct figure for HDB’s expenditure on upgrading programmes in FY2021.
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