Published November 3, 2009

Unsold HDB flats largely cleared: CEO

Remainder is reason for Sale of Balance Flats exercise, launched last month


(SINGAPORE) Facing steady demand for public housing, the Housing and Development Board (HDB) has almost cleared its stock of unsold flats. The agency also offered more units in the last financial year, incurring a larger deficit in the process.

'We have largely cleared our unsold stock,' said HDB chief executive Tay Kim Poh at a briefing on the board's annual report for FY08/09 ended March. 'We still have some balance units here and there . . . the number is a very small number.'

Based on past reports, HDB held about 1,500 completed units last year, and some 3,500 units in 2007.

According to Mr Tay, the few unsold flats left was a reason why HDB introduced the Sale of Balance Flats exercise last month. Under the scheme, the agency will offer flats from repurchases, previous build-to-order (BTO) exercises and selective en-bloc redevelopment schemes - once it has accumulated a sufficient number of them.

HDB launched 2,132 flats under this scheme and received 20,691 applications - almost 10 bids for every flat available.

HDB offered more flats in FY08/09, awarding 14,754 residential units - up 46 per cent from the previous year. This caused sale and development costs, together with the amount of CPF housing grants given out to rise. The deficit incurred by home ownership activities grew 54 per cent to $1.55 billion.

Upgrading activities also posted a higher deficit as more precincts took part in lift upgrading and interim upgrading plus programmes. The loss deepened 35 per cent to $696 million.

The upgrading of rental flats also widened the deficit for rental flat activities by 95 per cent to $150 million.

All in, net expenditure had increased 23 per cent year-on-year to $5.15 billion in FY08/09. HDB's deficit almost doubled from the previous year, from $1.08 billion to $2.12 billion.

In the financial year, HDB launched 12 BTO projects comprising 8,057 units, and one balloting exercise for 992 surplus flats. There were also two design, build & sell scheme (DBSS) developments offering 1,058 units.

HDB has not decided on the supply of new BTO flats for 2010. 'We will monitor the demand,' Mr Tay said. He added that HDB also plans to release more DBSS sites.

HDB also provided more help to home buyers, owners and the needy as the economic downturn unfolded. For instance, it gave out the additional CPF housing grant to 6,076 households in the financial year - 69 per cent more than a year ago.

Since the grant was made available in March 2006, more than 18,000 households have received some $285.8 million as at September.

There are also specially trained counsellors to help home owners with their loans. The number of flat owners in arrears of three months or longer fell to 30,770 in September from 33,670 a year ago. This means that the mortgage arrears rate slipped from 7.9 per cent to 7.5 per cent.

The lease buyback scheme, launched in March to allow low-income elderly Singaporeans to draw a lifelong income from the value of their flats, saw 425 applications as at September, up from 137 six months ago.

HDB has identified a few challenges for the coming year. One is to develop programmes that will help new residents integrate into the public housing community and boost social cohesion.

Another is to upgrade and rejuvenate older housing estates - more flats will turn 40 to 50 years old in the next 10 years.

HDB will be celebrating its 50th anniversary next year. To commemorate 50 years of public housing, it will be organising an international housing conference on housing development and urban solutions in January.