Cement is compulsory in the construction of homes. I do not think we have that many homes in Malaysia which was built using wood, especially when it comes to high-rise units here in the Klang Valley. Thus, any huge increase in its prices is sure to impact the property prices because cement is used extensively during the construction. There are many big names in the cement industry including YTL Cement, aalborgportland, HUME, CIMA, Lafarge and more. In fact according to an industry friend, the prices of cement in Malaysia has been on a downtrend for a number of years. No idea why, probably due to the lesser demand while supply remain huge, thus everyone tries to get more business through lower prices. Here’s an update on the cement scene.
Article in edgeprop.my here. There has been complaints from developers about the price increase for cement and our Finance Minister Lim Guan Eng says he will meet Domestic Trade and Consumer Affairs (KPDNHEP) Minister Datuk Seri Saifuddin Nasution Ismail next week to discuss on the cement price increase. Lim said that the government is concerned that the cementprice increase will cause a chain of reactions and affect a broader segment of the construction sector including infrastructures. The prices of cement has increased 40 to 50% as notified by suppliers andsome has taken effect since Saturday while others on July 1. Lim added, “If this (price increase) is to allow this one and only company to make a huge profit and harm the industry and economy (in the process), then this is something the government will take seriously.” Real Estate and Housing Developers Association Malaysia (Rehda) chairman Datuk Toh Chin Leong said, “I don’t understand why the prices of cement had to go up significantly and this will affect prices of houses as the construction sector uses a lot of cement to build houses and other infrastructures.” Article in edgeprop.my here.
Perhaps it’s a good reminder to everyone again that this is the reason why property prices will definitely not be going down every few years. Input costs are always rising and let’s not forget our friends working with developers. Surely we do not want them to tell us that they have not been receiving any salary increments for a few years? Courtesy reminder also that this cost reasoning part of the property price is a small increase yeah. Thus, do not believe anyone telling us that property price will suddenly spike a lot and we could sell that property we bought a few years before at super profits yeah. Well, perhaps it’s now the waiting time for a meeting between these two ministers which will happen only next week. Happy waiting.
Article written and edited by Charles. News article summarised by Dina Batrisyia.
<Featured Image is courtesy of Stock Photos from okcm >
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