KUCHING: The Sarawak Housing and Real Estate Developers Association (Sheda) has called for temporary price controls on important building materials.
Its chairman Datuk Sim Kiang Chiok said this would ensure price increases could be controlled and absorbed by the market slowly without affecting the national economy badly.
He said a sharp surge in demand in Malaysia was acknowledged to have caused a shortage of raw material supply with major economic powers also reopening their economies about now.
“Although the price index shows a small increase, with the continuous increase the effect will be significant over a period of time.
“This is coupled with the reopening of most sectors of the economy, there is a huge demand for raw materials to support production activities.
“With the opening of our economy under Phases 3 and 4 of the National Recovery Plan, most economic sectors are now able to restart and continue their business operations,” he said when contacted by Suara Sarawak recently.
“Demand for oil and gas has also soared, causing the increase in the price of raw materials, including increasing production and transportation costs.
“The lower purchasing power of our ringgit, as the exchange rate to the US dollar and other major currencies has declined, has also caused the price of imported building materials to rise.
“Therefore, developers need to absorb the cost increase if the property is sold at a fixed selling price while for unsold properties, the developer can adjust the property price to absorb the cost increase,” he added.
He explained that contractors faced with ‘material price variations’, could demand a price increase that would help reduce the increase in construction costs.
“Admittedly, the shortage of manpower will also cause an increase in construction costs and time delays as the value of work will become more expensive with higher wage demand and work progress may also experience delays.
“With the high rate of immunisation in our country, we can open up our economy to save jobs, however I see a lot of time needs to be given for the country’s economy and business to catch up and accelerate back to levels before the Covid-19 spread,” he said.