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The Sun
25-07-2025
- Business
- The Sun
US tariffs – Short-term shock, long-term opportunities for Asean real estate industry
KUALA LUMPUR: While the US reciprocal tariffs announced on April 2 have unsettled equity markets and export-driven sectors, property leaders believe the disruption could accelerate the adoption of digital technologies, sustainable construction practices and regional trade integration within Asean's real estate landscape. During a panel discussion titled 'Industry Countermeasures: Absorbing the Recent US Tariff Shockwaves' at the Asean Real Estate Conference and the Architecture, Interior Design and Building Exhibition 2025, three prominent figures – Real Estate and Housing Developers' Association (Rehda) president Datuk Ho Han Sang, PropertyGuru Group's head of real estate intelligence Dr Lee Nai Jia and United Overseas Bank senior Asean economist Enrico Tanuwidjaja – said that while the new US tariffs – which are scheduled to go into effect on Aug 1 – bring short-term uncertainty, they also present potential long-term opportunities for the industry. Ho said Malaysian developers are bracing for softer demand in industrial, commercial and high-end residential segments as exporters negotiate who will absorb the higher costs. 'Profit margins will be squeezed as importers and exporters split the burden,' he told the audience. 'With higher prices, purchase volumes will drop and investors will be more cautious. Slower sales mean cash flow problems, and cash flow is reality; without it, there is no oxygen.' Ho noted that while most construction inputs are locally sourced, imported steel, aluminium and glass may see price pressure if the ringgit weakens. The first sectors to feel the pinch, he said, will be export-driven industries scaling back factory expansions, reducing office space needs, and curbing retail growth. Yet he also flagged bright spots. 'Tariffs on Chinese goods could redirect manufacturing to Asean, and a weaker ringgit may attract buyers from Singapore, Hong Kong and Taiwan into projects like Penang Silicon Island or the Johor‑Singapore Special Economic Zone.' Lee observed similar patterns across Asean. Using PropertyGuru's platform data, he described a three‑stage reaction: initial shock, quick normalisation and preference recalibration. 'After the announcement, views on listings in Singapore plunged, while Malaysia and Vietnam saw smaller dips,' he said. 'But people quickly remembered that housing is a long‑term need. What changed is their behaviour where buyers are gravitating towards more affordable, value‑driven homes.' He highlighted Singapore's Linton Woods project, which sold 94% of units despite tariffs, thanks to its proximity to transport and employment hubs. 'Integrated developments are resilient,' Lee said. 'The key is offering value and convenience.' He added that confidence in governance, stemming from Vietnam's policy reforms to Malaysia's interest rate cuts, continues to underpin the region's housing markets. From a macro lens, Tanuwidjaja said the tariffs underline Asean's need to boost internal trade and reduce dependence on external markets. 'Intra‑Asean trade is only 17%, compared to over 40% in the EU,' he said. 'We need to integrate, use local currency settlements, harmonise regulations and build supply chains that loop within the region.' While describing Asean as 'resilient', he warned that volatility will persist throughout the current US administration: 'Businesses must plan for turbulence, not a quick fix. The next midterm election in 2026 is the next real pivot.' He also urged governments and developers to prepare for technological disruption. 'AI will transform customer service, marketing and operations. We must retrain workers for higher‑skill roles like architecture, design thinking, project integration, because low‑skill roles are most at risk.' All three panellists stressed innovation as a pathway through the turbulence. Ho highlighted Integrated Digital Delivery (IDD), a platform that digitally unites 180 industry stakeholders to cut errors and speed approvals, as a game‑changer already deployed in Singapore. 'IDD minimises waste and aligns everyone from engineers to regulators,' he said. 'Speedier approvals, like Penang's recent 36‑day affordable housing clearance, reduce costs and help projects move despite headwinds.' Green technology also surfaced as a competitive advantage. Lee pointed to Vietnam's success in renewable energy during the first trade war. 'This is our chance to lead with climate‑sensitive design and ESG frameworks tailored to Southeast Asia's climate,' he said. Looking beyond domestic markets, Ho urged Malaysian developers to revive their overseas promotion campaigns, targeting buyers from Hong Kong, China, and Singapore. 'Our products are internationally recognised and competitively priced by Asean standards,' he said. 'With stable governance and award‑winning townships, Malaysia can stand out.' Tanuwidjaja echoed the sentiment: 'The higher tide will lift all boats but only if Asean rows together.' While uncertainties remain, the panel's tone shifted from caution to resolve. The tariffs, they argued, could catalyse Asean's next phase of growth by forcing integration, accelerating digital tools and prioritising sustainability. 'If you don't change, you'll be changed,' Ho said. 'This is the moment for our industry to reinvent and emerge stronger.'
Daily Express
13-06-2025
- Business
- Daily Express
Developers warn 6 pct SST could push up housing prices
Published on: Friday, June 13, 2025 Published on: Fri, Jun 13, 2025 Text Size: For illustrative purposes only. KUALA LUMPUR: A 6 per cent sales and service tax (SST) on construction services starting July 1 could push up housing prices and stall the property market, the Real Estate and Housing Developers' Association (Rehda) warned, The Edge Malaysia reported on Friday. Rehda said the tax would increase developers' financial burden, who already pay indirect taxes on labour and materials, potentially forcing project delays and price adjustments. Advertisement Its president Datuk Ho Hon Sang said the market could slow as developers review their plans, adding that the retrospective application of the tax may lead to cost overruns. Although residential homes and related public amenities are exempt, Rehda expressed concern over serviced apartments on commercial land and shop lot units in mixed-use developments now being taxed. Rehda urged the government to postpone the SST rollout and grant a grace period until 2026 to avoid impacting affordability, especially for low-income buyers under housing schemes. * Follow us on our official WhatsApp channel and Telegram for breaking news alerts and key updates! * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
New Straits Times
13-06-2025
- Business
- New Straits Times
REHDA: 6pct SST to push up home prices, slow market expected
KUALA LUMPUR: The Real Estate and Housing Developers' Association (REHDA) Malaysia has cautioned that the newly imposed 6 per cent Sales and Service Tax (SST) on construction services will increase operational costs for developers and ultimately drive up home prices. While acknowledging the Ministry of Finance's recent announcement on the revised SST structure aimed at boosting government revenue, REHDA expressed concern over the unintended consequences this tax could have on the property sector. "We have yet to determine the exact impact, but we expect the move will lead to a slowdown in the market as developers make adjustments to their plans," said president of the association, Datuk Ir Ho Hon Sang. He noted that the Association had previously engaged in consultations with the government to seek clarification and to highlight the tax's possible repercussions on the industry. "The industry is already bearing indirect taxes on construction-related items such as building materials and labour. The addition of the SST will only add to our burden. To maintain fairness, we sincerely hope that the SST will not be applied retrospectively. "Any price hike adjusted to contracts signed prior to the effective date could result in cost overruns which left developers with no choice but to absorb the additional cost," he said. While the exemption for residential buildings and public housing-related amenities offers partial relief, REHDA remains concerned about developments built on commercial land, particularly serviced apartments in mixed-use projects. "In today's urban landscape, especially in city centres, where residential units are often part of mixed developments due to land scarcity, subjecting these units to SST will inevitably lead to increased housing prices, ultimately impacting homebuyers who will have to bear the brunt," Ho said. Ho warned that low-income buyers, including those who purchase affordable homes under programs like Rumah Madani, Rumah Selangorku, and Rumah Mesra Rakyat, will also be adversely affected if their homes are located on commercial land. Additionally, several local authorities require commercial components such as shop lots within strata residential schemes. These units, along with internal infrastructure built within the development, will also be subjected to the SST, further inflating costs, he said in a statement. REHDA is appealing to the government to delay the implementation, currently scheduled in about two weeks, and proposes a grace period until 2026. "We respectfully request the government to consider postponing the implementation date, currently set for approximately two weeks from now. Many of our SME members have yet to register with the Inland Revenue Board and a grace period until 2026 would provide sufficient time for them to make the necessary preparations."
New Straits Times
13-06-2025
- Business
- New Straits Times
REHDA warns 6pct SST will drive up home prices
KUALA LUMPUR: The Real Estate and Housing Developers' Association (REHDA) Malaysia has cautioned that the newly imposed 6 per cent Sales and Service Tax (SST) on construction services will increase operational costs for developers and ultimately drive up home prices. While acknowledging the Ministry of Finance's recent announcement on the revised SST structure aimed at boosting government revenue, REHDA expressed concern over the unintended consequences this tax could have on the property sector. "We have yet to determine the exact impact, but we expect the move will lead to a slowdown in the market as developers make adjustments to their plans," said president of the association, Datuk Ir Ho Hon Sang. He noted that the Association had previously engaged in consultations with the government to seek clarification and to highlight the tax's possible repercussions on the industry. "The industry is already bearing indirect taxes on construction-related items such as building materials and labour. The addition of the SST will only add to our burden. To maintain fairness, we sincerely hope that the SST will not be applied retrospectively. "Any price hike adjusted to contracts signed prior to the effective date could result in cost overruns which left developers with no choice but to absorb the additional cost," he said. While the exemption for residential buildings and public housing-related amenities offers partial relief, REHDA remains concerned about developments built on commercial land, particularly serviced apartments in mixed-use projects. "In today's urban landscape, especially in city centres, where residential units are often part of mixed developments due to land scarcity, subjecting these units to SST will inevitably lead to increased housing prices, ultimately impacting homebuyers who will have to bear the brunt," Ho said. Ho warned that low-income buyers, including those who purchase affordable homes under programs like Rumah Madani, Rumah Selangorku, and Rumah Mesra Rakyat, will also be adversely affected if their homes are located on commercial land. Additionally, several local authorities require commercial components such as shop lots within strata residential schemes. These units, along with internal infrastructure built within the development, will also be subjected to the SST, further inflating costs, he said in a statement. REHDA is appealing to the government to delay the implementation, currently scheduled in about two weeks, and proposes a grace period until 2026. "We respectfully request the government to consider postponing the implementation date, currently set for approximately two weeks from now. Many of our SME members have yet to register with the Inland Revenue Board and a grace period until 2026 would provide sufficient time for them to make the necessary preparations."
Malaysian Reserve
11-06-2025
- Business
- Malaysian Reserve
DBKL gazettes KL Local Plan 2040 to improve transparency, urban renewal
by Nurul Najmin Abu Bakar THE Kuala Lumpur City Hall (DBKL) has officially gazetted the KL Local Plan 2040, effective on June 11, to enhance transparency and guide sustainable urban development. Mayor Datuk Seri Maimunah Mohd Sharif said the plan reflects a collective social contract to shape the city's future through balanced growth, inclusivity and sustainability. 'The Local Plan is not just a planning document, it is your plan, my plan and our plan,' she said during her keynote address at the Real Estate and Housing Developers' Association (REHDA) Institute forum titled 'Resilient Cities, Sustainable Futures: Transforming Urban Landscapes through Sustainable Renewal' on June 10. She said the plan incorporated 4,000 public feedback submissions out of a total of 28,000 received. Maimunah credited Prime Minister (PM) Datuk Seri Anwar Ibrahim for urging that the plan be gazetted earlier, describing it as a rare intervention by the federal leadership in local urban planning. Anwar is scheduled to officially launch the plan on June 24. The plan identifies 139 sites across KL targeted for urban renewal. 'Urban renewal is like a medical check-up for a city every 15 to 30 years. It is not just about replacing old buildings, but about improving livability and infrastructure,' she said. She acknowledged that implementation will face challenges, particularly regarding strata management and the city's current maintenance practices. 'Our maintenance culture is still lacking, but we need scheduled and consistent upkeep of city assets,' she added. DBKL is also planning to make the Local Plan more accessible to the public, drawing inspiration from Singapore's Urban Redevelopment Authority (URA) model. Maimunah stressed the critical role of cities in addressing both economic and climate challenges. 'Cities occupy only 2% of the Earth's surface, but generate 70% of waste and greenhouse gas (GHG) emissions, and contribute 80% of global GDP,' she said. She said urbanisation should no longer be seen solely as a challenge, but also as an opportunity to drive innovation, economic growth and resilience. 'Our job is not only to make KL functional and efficient, but also to build a city that people are proud to call home,' she added.
