According to industry sources, the increase in the service tax from 6% to 8% will drive up the cost of building even more.
This additional expense will be passed on to buyers, they added.
“The rakyat’s main concern is how the government will handle inflation and the high cost of living and doing business,” said the executive director of KGV International Research.
“All social classes of Rakyat are feeling the heat. In the 2024 Budget, more targeted subsidies were announced. “We believe that all of this will alleviate people’s current pains,” he told the Business Times.
Tan stated that growing costs in building materials, labour, and compliance have plagued construction sector stakeholders, including homeowners.
Overall, the Budget for 2024 had some hopeful news. On Friday, the Prime Minister announced a RM1 billion allocation to qualified developers to resuscitate sick and abandoned housing projects.
In August 2023, 256 dormant projects valued at RM23.37 billion had been reactivated.
Furthermore, the government announced an RM2.47 billion budget for public housing projects in 2024.
“In 2024, the RM1 billion allocation is expected to affect 2,476 houses.” This is a critical step towards alleviating the suffering of those affected by abandoned initiatives. What is more crucial is the avoidance of unhealthy enterprises.”To avert such events, a more effective technique must be developed. Developers in any form will be barred from developing dwellings for a set length of time unless they can demonstrate their ability to deliver,” Tan added.
Moreover, he feels that the building of a chemical and petrochemical development hub at Johor’s Pengerang Integrated Petroleum Complex bodes well for the prosperity of Pengerang and its neighbouring districts.
“This involves special tax incentives, and we believe it will attract more investors to RAPID,” he added.
In the meantime, additional monies have been set aside for the People’s Housing Programme and Rumah Mesra Rakyat to construct new and renovate existing buildings, benefiting the B40 and M40 sectors.
A RM100 million budget has been put aside for low and medium-cost housing in both the public and private sectors, including repairs to water tanks, roofs, electrical cabling, and CCTV.”Surely this is a good way to upgrade the standard of living among the poorer segment of society,” he went on to say.
Lastly, Tan also hailed the new system, which will allow en bloc transactions from the present 100% consent of house owners to a level compatible with international norms such as Singapore’s, as a much-needed step.
“We await more details, as a lower threshold will enable more sales of projects that require renewal and redevelopment,” he said.
