Prices of new houses in Malaysia are expected to increase by 10 percent, primarily due to the absenteeism of foreign workers and higher cost of construction materials.
According to Datuk Seri Michael Yam Kong Choy, President of Real Estate and Housing Developers Association of Malaysia, the failure of foreign workers to report for work has caused delays, adding to costs that will certainly be passed on to consumers.
Although acknowledging the need to clampdown on illegal immigrants, Yam noted that the shrinking supply of workers would hurt developers as they would have to “pay more for labour to meet contractual deadlines, failing which they will be penalised.”
Under the Sales and Purchase Agreement, developers are bound to pay buyers a compensation in case of late delivery. Notably, the contracts in the private sector does not include any provision for price adjustments.
Meanwhile, Association president Datuk Lim Kai Seng expects sand and cement prices to increase by five percent to 10 percent, while transportation cost could rise by up to 20 percent.
~~ Credit to Farah Wahida, Editor of PropertyGuru ~~