KUALA LUMPUR: Property developers are urging the government to step in to address the surging building material prices to make sure house prices remain stable.

       The Real Estate and Housing Developers’ Association Malaysia (Rehda) Institute chairman Datuk Jeffrey Ng said increases in material costs had directly impacted the cost of doing business, which has resulted in a 13% to 20% hike in construction costs.

       “For instance, the price of mild steel surged by 41% and sands has risen 20% since October 2020,” he said during his keynote speech at the REHDA Institute CEO Series 2022 conference on Thursday.

       According to Ng, among the challenges faced by the real estate and property development industry include the rising cost of building materials, an increase in labor costs affecting project cash flow planning, as well as the movement control order (MCO) that temporarily halted construction works.

       “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 lacklustre market dictates no further room for price increases, whilst margins are already squeezed and continue to be eroded.

       “Hence, the Government intervention may be necessary to ease the cost pressure on the real estate and property development industry to ensure that house prices remain stable,” he said.

       In addition, Ng suggested that the country should relook to expand its Malaysia My Second Home (MM2H) Scheme to spur the property market.

       “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 program,” he said.