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SINGAPORE: The Housing and Development Board (HDB)\u00a0on Tuesday (Nov 11) reported a net deficit of S$6.34 billion (US$4.86 billion) for the 2024 financial year.<\/p>\n
The annual net deficit before government grants for FY2024 represents a fall from a record S$6.78 billion the previous year.\u00a0<\/p>\n
\u201cHDB incurs a significant deficit every year, as the amount collected from the sale of flats is lower than the total development cost of Build-to-Order (BTO) flats and housing grants disbursed,\u201d the board said in a media release.\u00a0<\/p>\n
Of the FY2024 deficit, S$5.51 billion was incurred for the home ownership segment, with another S$532 million spent on upgrading programmes.\u00a0<\/p>\n
The home ownership segment covers the development and sale of flats and the disbursement of housing grants to eligible households of new and resale flats.<\/p>\n
The deficit for the home ownership segment was mainly from gross loss on the sale of flats, expected losses on flats currently under development and the disbursement of Central Provident Fund (CPF) housing grants.\u00a0<\/p>\n
HDB incurred a higher gross loss of S$1.77 billion for the 14,900 flat sales completed \u2013 keys issued to buyers \u2013 in FY2024, compared with S$1.37 billion in FY2023.\u00a0<\/p>\n
The board also recorded S$2.69 billion in the provision for \u201cforeseeable loss\u201d for flats under development in FY2024. HDB started development of about 23,600 flats in FY2024.<\/p>\n
“When HDB begins development of new housing projects, provision is made for the estimated loss of these projects as HDB flats are sold at subsidised prices below their development cost,” it said.\u00a0<\/p>\n
“This provision is updated during the construction phase of the project, due to cost changes.”<\/p>\n
With the completion of sales when keys are issued to flat buyers, the provision for foreseeable loss will then be released, and the actual loss from sales will be reflected.<\/p>\n
In FY2024, the Housing Board disbursed fewer grants to eligible buyers of resale flats and executive condominiums.<\/p>\n
About S$881 million was handed out in FY2024, compared with the S$999 million disbursed the previous year.\u00a0<\/p>\n
\u201cSeparately, HDB continued to upgrade and spruce up rental flats for lower-income Singaporeans and those in need of housing support in FY2024,\u201d the board said.<\/p>\n
HDB spent about S$159 million for the provision of rental flats to eligible tenants under various rental housing schemes \u2013 a slight dip from the S$160 million it spent in FY2023.<\/p>\n<\/div>\n