Leasing for MVR6,600 per month would have caused a loss of MVR1.1 million for each apartment
As reported by Avas, the Maldives’ Auditor General’s Office released a report that indicates that a monthly rent of MVR6,600 (USD427.35) for flat units in Hiyaa social housing project isn’t a feasible option.
The former administration set the rent of the social housing units at MVR 6,600.
The current government raised the rent to MVR11,000 and then decreased it back to MVR7,500 following harsh criticism from the public.
The Housing Development Corporation requested the government to provide details on the calculations that allowed the revision.
Following number revisions, the Auditor General’s Office said the initially proposed rent of MVR11,000 is an adequate amount to be charged. This proposal includes an additional MVR1,000 maintenance fee for 20 years at an interest rate of eight percent.
The report noted that the calculations were done using the Equated Monthly Installment (EMI) method, considering the loans borrowed for the housing project, interest charged on re-financing loans, and loan repayment cash flow.
The EMI method was not used by the former government, and leasing for MVR6,600 per month would have caused a loss of MVR1.1 million for each apartment.
Additionally, the Auditor General’s Office recommended using the method in doing calculations for similar projects in the future.
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