“Rehda predicts rising construction costs will impact Malaysian property prices in 2024. Stay informed with our latest report.”
KUALA LUMPUR, 18th Mar 2024 – Anticipated challenges in the escalating cost of construction materials are projected to drive significant increases in Malaysian property prices during the first half of 2024 (1H 2024), as outlined by the Real Estate and Housing Developers’ Association (Rehda).
Discussing Rehda’s findings from the Property Industry Survey for 2H 2023 and Market Outlook for 2024 reports, its president, Datuk NK Tong, noted that the prices of building materials continued to surge. Developers reported an annual increase of over 10 per cent in the average prices of sand and concrete by the end of December 2023.
“In today’s media briefing, he mentioned that this equates to an anticipated average construction cost surge of 15 percent in 1H 2024,” Tong elaborated. He further noted that 91 percent of the survey participants observed a greater uptick in building material costs in 2023 compared to preceding years.
“In essence, the rise in building material prices will lead to escalated construction expenses. We aspire for effective resolution of this matter and urge all stakeholders to fulfill their responsibilities to mitigate the impact on Malaysians,” he remarked.
Tong also highlighted that property market participants maintain a neutral stance on the business and property industry outlooks for 1H 2024 but exhibit greater optimism towards the market in 2H 2024.
“Although understandable given the industry’s challenges, the increased optimism for the latter part of the year reflects the confidence of respondents and developers in the market’s potential improvement,” he remarked.
Addressing the proposed Urban Redevelopment Act, Tong emphasized that the notion of enabling developers to profit from land seizure is misplaced. He asserted that responsible developers like Rehda members have numerous alternatives to acquire development land elsewhere, which would be easier to develop compared to repurposing existing buildings.
“However, as a strategic initiative, Rehda Malaysia commends the Ministry of Housing and Local Government, under the minister’s guidance, for its vision to continually enhance the urban landscape of cities, ensuring their global competitiveness and appeal for the benefit of the people.
“We anticipate more specific details to engage with KPKT, but we trust that they have thoroughly examined similar successful models from the region that have operated effectively for many decades,” he concluded.
