Financial Loss Recorded in HDB's Annual Report

Mr Ong Teng Koon asked the Minister for National Development whether the provision of $625 million for foreseeable loss relating to properties under development, as announced in HDB's annual report for FY2017, relates to housing subsidies that are being given to Singaporeans and whether he can give the assurance that these subsidies are being allocated to those who need it the most.

The provision of $625 million for foreseeable loss for properties under development or for sale is the estimated loss that the Housing and Development Board (HDB) expects to incur for Build-To-Order (BTO) projects awarded in the financial year ended 31 March 2017, including from housing subsidies given to new flat buyers. HDB makes a development loss on the BTO programme, as BTO flats are heavily subsidised. BTO flats are sold with a generous discount to their assessed market values, and this means that selling prices can be significantly below the cost of developing these flats.

To ensure that housing subsidies are given to Singaporean families who need them most, HDB has put in place eligibility conditions, such as nationality, income ceiling and non-ownership of private residential property requirements for access to new HDB flats. In addition, HDB provides means-tested grants to eligible first-timer households through the Additional CPF Housing Grant and Special CPF Housing Grant. These subsidies are targeted at lower- to middle-income Singaporeans, with the lower-income receiving more help.

We will continue to calibrate our housing subsidies progressively and judiciously to ensure that public housing remains affordable to Singaporeans.