HDB suffers S$2b deficit

zenden9 SG

SINGAPORE: The Housing and Development Board (HDB) has reported a S$2 billion deficit before government grants in its latest annual report. The figure is more than double the loss reported in the previous financial year.

HDB said the huge deficit for the financial year ending March was due mainly to more flats being sold. These flats are highly subsidised by the government.

Higher construction costs also led to the large deficit. Other reasons that contributed to HDB’s loss included upgrading works for lifts and rental flats.

Between April last year and March this year, HDB pushed out 8,000 flats under its Build—To—Order Scheme. That was 2,000 more than what it supplied the year before.

At a media briefing on its latest annual report, HDB also gave an update on the Lease Buyback Scheme which allows low—income elderly Singaporeans to get a portion of cash upfront while HDB buys back the tail—end of the lease of their flat.

HDB has received more than 400 applications since the scheme was launched earlier this year. Some 25,000 households are eligible for the scheme, but the elderly have other options to monetise their flats.

HDB’s CEO, Tay Kim Poh, said: "Some of them will sublet their entire flat, and the rental for even a three—room flat is very good nowadays. They can easily get S$1,500 per month from the rental and they (then) move in to stay with their children."

Despite the global downturn, HDB said the mortgage arrears rate has dropped 0.4 percentage point to 7.5 per cent.

Market watchers said this may be due to the high resale prices of HDB flats.

Eugene Lim, associate director of ERA Asia Pacific, said: "There was an upswing in the market since the beginning of this year. And what happens is that those households in arrears probably made use of this opportunity to sell their flat and downgrade to a flat that they can afford."

Moving forward, HDB said it will focus on improving community relations. A new department has been set up within the housing board to look at strengthening social cohesion and integrating newcomers.

— CNA/ir

http://sg.news.yahoo.com/cna/20091102/tap-349-hdb-suffers-s-2b-deficit-231650b.html

Hahaha...

Today not April fool leh. HDB suffer losses due to selling subsidise HDB flat to singaporean? Oh.. Dear PAP, we singaporean owe u so much.

Ajen SG

so its our fault for their loss is it?

lotus999 SG

not to worry, it will make more than double back next financial year!

deepak.c SG

Singaporeans better be grateful, if not for the subsidies your 2 bedroom HDB flats will cost at least half a million dollars.

Vote in PAP for more good years ahead!!!

Frogleg888 SG

I believe most of their losses are paper loss!

Government sells them the land below market rate,therefore they can sell us flats below market rate,and they said our flats are subsidised.

To break even or avoid losses,they need to sell us at market price.

So think about it,if they sell us flat at market price,that is called "Break even" only.

We have to wonder,at market rate,private developers can make profit but HDB is just "break even" only.

xtreyier SG

Go on. Gloat over the loss given to citizens. Buy that flat and rent it out to foreigners at a premium while staying with parents or in a condo. Complain that the units are lousy, no good facing or low floor or whatever, and to build more. Don't have to feel any tinge of guilt.

It's only our next generation's accomodation that we are robbing today. Every block built today means a few hundred sqft of land is used up on our tiny small red dot, depriving the child you see in school today a home of his/her own tomorrow.

Go ahead, ask more subsidize. Build more flats, with more of our public funds used to beautify our homes in features and surroundings. Make the next generation pay thru their noses when it their time is due, or tell them to rent or those who less priveledge, the gardens are airy and cosy.

Enjoy the loss. Smile. Your complains had been heard. No authoritarian to put his foot today anymore. And tell it honestly why it was lost, no need to twist the truth, to your children, your kid brother, your kid relatives, and their friends in their naive and trusting eyes.

angel3070 SG

I don't get your post.

What is the main point?

Pentaxdude90 SG

It's only our next g oreneration's accomodation t? hat we are robbing today. Every block built today means a few hundred sqft of land is used up on our tiny small red dot, depriving the child you see in school today a home of his/her own tomorrow.

or ? I also dunno.

jacknife SG

or ? I also dunno.

Its a joke so let us

Chew Bakar SG

QX179R SG

http://www.sgforums.com/forums/3317/topics/380656

mlmersrlosers SG

so that maybe explains why the price of hdb flats still being so high despite the economy downturn. Many had expected the price of hdb flats to fall during this time, but instead they still remain as high as ever, if its only the heartlanders r complaining about this, then its understandable. But even the experts like financial analysts r highlighting this issue. WHY ARE HDB PRICES STILL SO HIGH? Trying to recoup the "losses?" (they claim) no one knows how much becos they are not transparent to us.

Beware of the election. Maybe after the election, "they" will try to recoup the losses made by temasek, HDB, by increasing this or that. We had experienced in the past. Will Sillyporeans fall for that again?

frakfrakfrak SG

Dear frog. How sauna, warm or hot? Jump leh. please. please jump leh.

zenden9 SG

Just an propaganda to make u singaporean feel so ingrated to PAP of the losses billion for HDB.

In fact, they make billions and just manipulate the data to appear losses and release this crap of news. The media belongs to them, data and calculation are all not transparent. The more I see this kind of news, the more convince they are making profit.

Rooney9 SG

HDB never say how much they earn? HDB is a monopoly in Singapore mind you, in the type of housing they build.

iceFatboy SG

i wish someone with good finanical knowledge can enlighten us, cause I am still puzzled at how they lost so much when seemingly, everything seems to point to a profit for them.

my first thoughts were to cut the pay and maybe, they can cover the 2B and make some profits, but that will be undermining some of the hardworking people in HDB. maybe, just the top brass, given they are only earning peanuts. :P

angel7030 SG

i wish someone with good finanical knowledge can enlighten us, cause I am still puzzled at how they lost so much when seemingly, everything seems to point to a profit for them.

Ah!!! allow me, former CPA certified accountant for Joo Chiat Hotels and Business Association.

In accounting, there is two terms which you need to understand, first is the so call Going Conern. As HDB built flats and surrounding precint facilities such as park, shelters etc etc...in accounting term of going conern, all costs are calculated as present concern. However, in layman term, all these flats and facilities are potential profits for HBD in a long run, the so called selling thru loan and interest (which now settle thru third party).

Therefore you will hardly believe that HDB is at a lost. And you absolutely right, but this is because the profits has not been realised, it cannot be put into the account. The term is call accrue profit. Accrue meaning to come to one as gain in near future. But in the moment HDB is building it, and when buyers paid up thru third financial party, they will reflect a gain..maybe by 2 billions.

On the hindsight, as a public civil organisation by protraying a deficit can better seek sympathy from the public rather than protraying a gain, which may anger the public, especially the ordinary Singaporeans like most uncles and aunties here.

angel7030 SG

i wish someone with good finanical knowledge can enlighten us, cause I am still puzzled at how they lost so much when seemingly, everything seems to point to a profit for them.

Ah!!! allow me, former CPA certified accountant for Joo Chiat Hotels and Business Association.

charlize SG

I think they calculate the "loss" based on the opportunity cost of the land in which they build the flats. ie what the land would have earned if it was sold to private developers instead or something to that effect.

iceFatboy SG

hmm.. well, we can't build "ION Orchard" all over sg, right? LOL