The Housing Board suffered a deficit of $2.02 billion for the fiscal year ended 31 March 2015, reported The Straits Times citing the agency’s latest audited financial results.
This is not only higher than the $1.97 billion loss during the same period last year, but also surpassed the $797 million and $443 million deficit recorded in previous financial years.
HDB posted this loss even though its homeownership programme, which makes up most of the deficit, declined to $1.75 billion from its historic high of $1.93 billion in FY2014.
This is because surpluses in other areas fell. For instance, the surplus from its rental and related businesses segment dropped from $745 million to $679 million. Moreover, the Additional and Special Central Provident Fund (CPF) Housing Grants disbursed to home buyers rose to $263 million from $162 million previously.
Moving forward, the agency’s deficit is expected to remain high in the next few fiscal years as flats launched from 2011 to 2013, during a period when supply was raised, are still being completed and delivered to their owners, said National Development Minister Khaw Boon Wan during a parliamentary session in January.
In addition, about 26,000 HDB flats are projected to be ready this year, while another 25,000 units are forecasted to be completed annually over the next two years.
HDB incurs losses on home sales as it subsidises selling prices of flats to keep them affordable instead of adding a premium on top of their development cost. To keep it operating in spite of the deficit, the agency receives a grant from the Ministry of Finance every year.
Romesh Navaratnarajah, Singapore Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@propertyguru.com.sg
