KUALA LUMPUR (Jan 20): During the Real Estate and Housing Developers’ Association Malaysia (Rehda) Institute CEO Series 2022, property developers have urged for the government to step in to address the surging building material prices to ensure that house prices will remain stable, reported by The Star.
In the media conference held on Thursday (Jan 20), Rehda Institute chairman Datuk Jeffrey Ng noted that the price for building material has led to the increase of a 13% to 20% in construction cost.
Adding that the price hike has impacted the cost of doing business.
“For instance, the price of mild steel surged by 41% and sands has risen 20% since October 2020,” he said during the conference quoted by The Star.
Besides the rising cost of building materials, Ng also shared that an increase of labour cost which affects cash flow planning and also the various implementation of the movement control order has been one of the challenges for the real estate and property development industry.
“As the real estate and property development sector is already in a ‘cost-push inflation’ market, further cost increases cannot be absorbed by the market as prices have been fixed beforehand.”
“A lackluster market dictates no further room for price increases, whilst margins are already squeezed and continue to be eroded.”
Besides that, Ng has also commented that the Malaysia My Second Home (MM2H) Scheme could be expanded where it can encourage businesses and talents into the country rather than just focusing it as a retirement programme.
“An expansion of such schemes could also encourage international business migration into the country, and attract more businesses and talents compared to a purely retirement programme,” he said.
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