Reported in The Malaysian Reserve today (15 Aug) was a very interesting piece of news. Would you be interested if the total cost of construction for new properties can come down 40%? Before you think about RM500,000 homes becoming RM300,000, do note that the 40% is on cost of construction. So, translated into gross amount, I think perhaps 20% down in cost of construction. This meant that a RM500,000 property can still be sold at RM400,000 and the developer is still getting the same profit margin. Not bad for both the developers as well as the buyers right?
The few partners who will be making this happen would be the The Construction Industry Development Board (CIDB) and Bayer Co (M) Sdn Bhd. Two prototype houses would be built in CIDB’s Industrialised Building Show Village site in Kuala Lumpur. The great news is, it will be ready by October 2014. The model houses will be built using a lightweight polyurethane composite panels developed by Bayer and they are both cost effective and easy to assemble. In other words, labour costs are minimised tremendously. This will greatly assist the Malaysian government’s target to build one million affordable and comfortable housing for the needy. The technology would be provided by Bayer’s high-tech materials subgroup, Bayer MaterialScience. The main business activities for this subgroup would be on the manufacturing of high-tech polymer materials.
Remember just weeks ago I wrote about how new homes may need just months to construct instead of years? Read it here: New home in few months and not few years. Interested? Today, suddenly the announcement is that it can be built within days? Personally I am not sure how this would affect the property industry because if all developers adopt this, then the new homes supply can suddenly be increased tremendously and the prices would go down accordingly? Also, what’s the quality really like? Can it be used for building of a 40 storey building? If it is really so easily adaptable, why are the more developed nations not using it to cool down their property markets? No worries, the most important thing right now is for everyone who is interested to visit their show unit once its ready in October 2014. Thats just 2 months away.
written on 15 Aug 2014
Next suggested article: Property market is slowing. Agree. However, there are today MORE interested people.