Rehda estimates more than RM60b development expenditure in Budget 2022 – CGS-CIMB

KUALA LUMPUR (Oct 15): Real Estate and Housing Developers’ Association Malaysia (REHDA) has estimated the targeted development expenditure (DE) for Budget 2022 to be between RM60 billion and RM65 billion and may feature the roll-over of unutilised DE for 2021.

According to CGS-CIMB’s research note today, what is key for Budget 2022, in REHDA’s view, is a clearer implementation plan relating to the RM400 billion DE under the 12th Malaysia Plan (12MP), as the overall industry rail contractors and suppliers would be zoning down on the status of the Mass Rapid Transit (MRT3) project, which was missing from the 12MP.

“A short-term positive is, with mobility restrictions being lifted, the construction sector, including contractors with property development divisions immediately benefitting from the stabilisation of the industry’s domestic supply chain in the fourth quarter of 2021 (4Q2021),” the research house said.

Concurring REHDA’s view, CGS-CIMB said sector job replenishment prospects are expected to gradually improve in 4Q2021 and the first half of next year, however, the rollout of larger-scale new mega contracts may take some time to get off the ground due to funding limitations.