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Beware about rising building material prices in 2023

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Despite the bleak outlook for global economic development, 2023 is anticipated to signal the market’s turning point in Malaysia. Not only has the country’s real estate market recovered its momentum, with the quantity and value of real estate deals and loan applications returning to pre-Covid-19 pandemic levels, but it has also done so as a result of pent-up demand from homebuyers, investor fear of missing out, the strong fundamental demand from the young demographic segment, and the new administration’s commitment to lowering the high cost of living.

More significantly, according to MKH Principal Researcher Dr. Foo Chee Hung and General Manager Brandon Loo of MKH Construction Materials Sdn Bhd, a trend toward falling building material prices has been noticed throughout the fourth quarter of 2022.

“However, when a longer time period of pricing for important construction materials is reviewed, one may see that the steel bar price is still greater than it was in 2019, despite the fact that it has begun to level down from August 2022, at a range of RM2,700-RM2,800 per metric tonne.

According to recent reports, the government plans to withdraw power subsidies for medium- and high-voltage industrial customers in order to lessen the effects of rising coal prices in the energy industry. Another wave of price increases for steel bars will undoubtedly be fueled by a tariff rise of more than 566%, which would bring the current 3 sen per kWh rate to between 20 and 27.7 sen per kWh. To counteract this, there would likely be an increase of RM200/mt.

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Source: theSUN

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