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Cement price - impact on house price

posted Jul 20, 2019, 7:38 AM by jeffery jim

Lately, there is this rumor about possible increase in cement price. For me, this news is only use as a tool to render speculation and assure people to buy properties before so-called hike in price. Nothing more than that.

Let say, cement price increased by 50%, what is the outcome? For me, it is minimal.

Let say,
A house uses:-
1. 16 columns (600x600x3000mm) = 17m3
2. 30 beams (300x600x5000mm) = 27m3
3. Slab with area size 150m2 (built-up) with thickness of 200mm = 30m3
The total concrete is 74m3,

A m3 of concrete uses around 350kg which is equivalent to 7 bags. So, 74m3 x 7bags = 518 bags.

The current price is around RM20 per bag which mean, the total cost is around RM10,360.
50% increase means around RM5,180. It is lower than some Sales and Purchase agreement (S&P) fee.

Therefore, there is no point to rush and buy since the price will not skyrocket. Secondly, due to competition, the contractor may absorb in order to compete with price of houses for re-sell.

Always be smart enough to observe, wait and see. The price of houses will continue to drop by the months until 2021.


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