10 Popular Questions about Cost of Building a House in Malaysia | Kontraktor Bina Rumah Atas Tanah Sendiri | Rumah IBS

What is the average cost to build a house in Malaysia?
What factors affect the cost of building a house in Malaysia?
How much does it cost per square foot to build a house in Malaysia?
Is it cheaper to buy or build a house in Malaysia?
What is the cost breakdown for building a house in Malaysia?
How can I reduce the cost of building a house in Malaysia?
What is the cost of building materials in Malaysia?
How long does it take to build a house in Malaysia?
What are the financing options available for building a house in Malaysia?
How do I find a reliable contractor to build my house in Malaysia?

Table of Contents

What is the average cost to build a house in Malaysia?

The average cost to build a house in Malaysia can vary greatly depending on factors such as location, size of the house, types of materials used, and additional amenities. However, most industry experts estimate the average cost to be between RM200 to RM500 per square foot.

This means that for a moderately sized terrace house of 1,600 square feet, you can expect to pay RM320,000 to RM800,000. For a semi-detached house of 2,000 square feet, the cost would be RM400,000 to RM1,000,000. The cost is higher for bungalows, townhouses, and luxury homes.

Here is a breakdown of the typical costs to build common house types in Malaysia:

Terrace house (1,600 sq ft) – RM320,000 to RM800,000
Semi-detached house (2,000 sq ft) – RM400,000 to RM1,000,000
Bungalow (3,000 sq ft) – RM600,000 to RM1,500,000
Townhouse (2,500 sq ft) – RM500,000 to RM1,250,000
Luxury bungalow (5,000+ sq ft) – RM1 million to RM5 million+

The cost per square foot in key city centres like Kuala Lumpur and Penang is often on the higher end of the range due to prime locations and higher land values. Suburban areas and small towns will be on the lower end.

Some main factors that influence the construction cost in Malaysia:

Location – Land in major cities and developed areas costs more
Size of the house – Larger homes cost more to build
Types of materials – Premium materials like marble and imported tiles add to cost
Finishes and fittings – Luxury fittings and branding increase costs
Additional amenities – Pools, landscaping, home automation systems add cost
Labour costs – Higher demand for workers can increase labour costs
Logistics – Remoteness and access to materials affects transport costs

Understanding these cost factors allow you to make an informed budget when planning your dream home. You can also save on costs by designing a practical layout, minimalist aesthetics, and using local materials.

What factors affect the cost of building a house in Malaysia?

There are several key factors that influence the cost of building a house in Malaysia:

Location

The location of the land is one of the biggest cost determinants. Land prices are significantly higher in major city centres like Kuala Lumpur, Penang, and Johor Bahru compared to the outskirts and suburban areas. Prime locations also command higher premiums. This means construction cost per square foot can be RM50 to RM100 more just based on the location.

Land area

The size of your land will affect the total construction cost. Larger land areas allow bigger home designs but also mean higher foundation and infrastructure costs. Limited land area in prime locations means building upwards for multi-storey homes.

Building size

The size of your home measured by square footage is directly proportional to the overall building cost. A simple 2 bedroom 800 sq ft terrace will cost much less than a 5,000 sq ft luxury bungalow. Building larger spaces, rooms, and multiple floors adds to material and labour costs.

Construction materials

Using premium materials like granite, marble, or imported tiles and fittings will elevate the cost compared to locally sourced materials. Timber, brick and concrete structures are cheaper than steel and glass. The finishing and fittings chosen also affect cost.

Labour costs

Local construction labour in Malaysia is still considered affordable but shortage of workers in recent years has led to some increase in labour costs. Foreign labour import also adds to cost. Highly skilled craftsmen charge premium rates.

Permits and compliance

Navigating regulations, getting approvals and permits before construction adds to administrative fees. Compliance with building standards and requirements also add to costs. Environmental impact assessments may be required too.

Logistics

For remote areas, transportation of construction materials can increase building costs. Locations far from supplies of sand, stone, wood etc can mean higher logistics expenses to transport raw materials.

Additional structures

Adding features like a swimming pool, landscape gardens, electrical fencing and surveillance systems will all increase the construction budget. Luxury fixtures, smart home systems and high-end branding elements also raise costs.

Contingencies

Having a 10-20% contingency budget for cost overruns due to unforeseen events or spikes in material costs is recommended. Weather delays, planning changes and poor estimation can be covered by the contingency funds.

Construction company

The reputation, experience, overhead costs and profit margins of your chosen construction company influence pricing. Get multiple quotes to find the best value. New contractors may offer cheaper pricing compared to established firms.

By understanding the key cost drivers, you can make adjustments to create a home construction budget that balances your lifestyle needs with financial resources.

How much does it cost per square foot to build a house in Malaysia?

When budgeting to build a house in Malaysia, a useful benchmark to know is the typical cost per square foot of construction. This provides an average estimate that you can use for initial planning and calculating the overall budget needed.

The typical cost per square foot for building a house in Malaysia ranges between RM200 to RM500.

However, this cost per square foot varies significantly based on these factors:

Location of the land
Type and size of the house
Quality of materials and fittings
Additional structures and amenities
Labour costs
Logistics and accessibility

Here is a breakdown of the typical cost per square foot to build different types of homes:

Terrace house – RM250 to RM350 per sq ft
Semi-detached house – RM300 to RM400 per sq ft
Bungalow – RM350 to RM650 per sq ft
Townhouse – RM400 to RM500 per sq ft
High-end bungalow – RM550 to RM1,200+ per sq ft

Key Locations and Average Cost per Square Foot

Kuala Lumpur – RM380 to RM650 per sq ft
Penang Island – RM350 to RM600 per sq ft
Johor Bahru – RM250 to RM480 per sq ft
Selangor – RM200 to RM450 per sq ft
Melaka – RM200 to RM400 per sq ft
Sabah & Sarawak – RM180 to RM350 per sq ft

As you can see, property in Kuala Lumpur and Penang Island commands a much higher cost per square foot compared to other regions of Malaysia. Luxe bungalows and mansions may even breach RM1,000 psf in prime KL addresses.

If your land is in an isolated rural area away from amenities, you could build at RM180 to RM250 psf or lower. A basic steel industrial building would only cost RM120 to RM150 psf on average.

Factors that increase the cost per square foot:

Prime locations like city centres
Luxury materials like marble, glass, timber
Building larger homes with more floors
Swimming pools, landscape gardens
High-end smart home systems
Guardhouses and fencing

Factors that decrease the cost per square foot:

Outlying suburbs and small towns
Concrete, brick and locally sourced materials
Compact and practical layouts
Basic fittings and minimalist aesthetics
No swimming pool or gardens
Semi-furnished units with DIY finishing

The cost per square foot rate gives a quick benchmark, but the total budget will depend on the size and design of your actual home. Prepare for this budget to also increase by 10-20% for contingencies, changes and delays during the construction phase.

Is it cheaper to buy or build a house in Malaysia?

For new homeowners in Malaysia, a common question is whether it is cheaper in the long run to buy an existing house or to build a new one. There are pros and cons to each option in terms of upfront costs, long term costs, customization, and intangible value. Here is an overview of the key considerations when deciding whether to buy or build.

Upfront Costs

Building a new house often requires higher upfront costs but with the advantage of customization. Based on current property prices, building a 2,000 sq ft terrace or semi-D costs RM400k to RM1mil. An equivalent completed home would cost RM600k to RM1.5mil. However, buyers may get better loan rates and payment packages when buying completed stock.

Customization

Building gives full customization over design, layout, fittings, materials, landscaping etc. Buying means compromising on some preferences or doing major renovation. However, buying may allow moving in faster without the hassles of construction.

Future Costs

Building allows installing higher quality materials, fixtures and systems that require less maintenance over time. Buying an older property may require heavy future costs for repairs and upgrades. But building requires paying interest on larger loan amounts.

Capital Appreciation

Well-built newer properties on ideal locations tend to see higher capital appreciation over time. But overly customized homes may appeal to a smaller target market when reselling. Landed property generally holds value well if maintained properly.

Intangibles

Some homeowners prefer the satisfaction and legacy value of building their dream home from scratch. But the time, complexities and delays of construction may deter others from building.

Key Factors Favoring Buying

Completed properties allow faster occupancy
Requires smaller loan amount at potentially lower rate
Avoids hassles and delays of construction
May find better bargains during weak property markets

Key Factors Favoring Building

Full customization of design and fittings
Potentially higher quality materials and fixtures
Lower maintenance costs over the long term
Higher future capital appreciation

Overall, building a house allows ultimate flexibility and quality control but requires more upfront capital and a 1 to 2 year construction timeline. Buying a completed property provides faster occupancy and potentially cheaper financing but less customization. Assess your priorities, budget, location needs and lifestyle to decide between buying or building in Malaysia.

What is the cost breakdown for building a house in Malaysia?

When budgeting to build a house in Malaysia, it is helpful to know the typical percentage breakdown of the major construction cost components. This allows you to allocate sufficient funds to each important category and avoid budget overruns later.

Here is an overview of the typical cost breakdown to build a 2-storey terrace house:

Item	Percent of Total Cost
1. Land cost	10-15%
2. Professional fees	5-8%

Architect fees
Engineer fees
Surveyor fees
Legal fees 3. Construction & materials | 50-60%
Foundation & structure
Brickwork, plastering, tiling
Carpentry, roofing, painting
Plumbing, electrical wiring
Doors, windows, sanitary fittings
Wall, ceiling & floor finishes 4. Contingencies & variation | 10-15% 5. Authority approvals & permits | 1-2% 6. Interior fittings & furnishings | 5-10%
Kitchen cabinets & appliances
Bathroom fittings & accessories
Light fixtures, fans, wardrobes
Air-conditioners, security system

This breakdown can vary based on the size and type of home, level of fittings, cost of materials and location.

For a basic terrace house below RM500k, the construction cost may be 50-55% of total. For a high-end bungalow above RM2 million, the percentage for fittings and finishing may be 15-20%.

Let’s see how this cost breakdown applies to a real-world example:

2-Storey Semi-detached House

Built up size: 2,400 sq ft
Location: Selangor
Cost per sq ft: RM300
Total budget: RM720,000 (2400 sq ft x RM300)

Cost Breakdown

Land (15%) = RM108,000
Professional fees (7%) = RM50,400
Construction & materials (55%) = RM396,000
Contingencies (12%) = RM86,400
Authority approvals (1%) = RM7,200
Fittings & furnishings (10%) = RM72,000

Having a budget allocation for each major component allows you to plan, manage cashflows, and track spending more effectively during the construction journey. Adjust the percentages according to your specific home design, location, and quality of materials chosen.

How can I reduce the cost of building a house in Malaysia?

Building a house in Malaysia can be very costly, with the average price ranging from RM200 to RM500 per square foot depending on location and specifications. However, there are ways to reduce your construction budget through smart design and material choices.

Here are some tips to build a house in Malaysia at a lower cost:

Pick an affordable location

Land prices can vary greatly depending on proximity to major cities and developed areas. Opting for land in outer suburbs or small towns can immediately reduce your base cost compared to prime locations. However, factor in future convenience and amenities nearby.

Reduce overall size

Build a more compact home with open layouts that minimise corridors and partition walls. For example, combining the dining and living areas creates efficiency. Go for single-storey or small two-storey designs to reduce building footprint.

Use local construction materials

Imported materials like high-end tiles and fittings can be very costly. Using bricks, ready-mix concrete and locally sourced wood and stone help lower material expenses. Factory manufactured roofing, windows and precast elements are budget-friendly too.

Design simple, functional spaces

Avoid intricate architectural details and curved walls which require complex framing and finishing. Square or rectangular grids and layouts simplify the construction process and trim labour time. Focus on functionality over form.

Minimise basement levels

Excavation and waterproofing for basements can add substantially to structural costs. Avoid large basements and keep all spaces at ground level or above.

Standardise fittings

Opt for homogenous floor and wall tiles throughout the house rather than custom finishes in each space. Standardise door frames, sanitary fittings, lighting fixtures etc for bulk purchase discounts.

Install insulation features

Strategically place insulation, reflective paints and double-glazed windows to improve indoor temperature regulation. This reduces the need for extensive air-conditioning which cuts electrical costs.

Build in phases

For very large homes, build the basic structure first. Leave the finishing touches like bathrooms, kitchen, cabinetry etc to be done later in stages. This spreads cash outflow over time.

Act as project manager

Closely overseeing the construction progress lets you sometimes spot excessive material usage or man hours. Avoiding wastage optimises your building budget.

With prudent design considerations and material choices, building costs in Malaysia can be contained without compromising on safety and aesthetics. Strike a balance between needs and affordability.

What is the cost of building materials in Malaysia?

The cost of building materials is a major component that affects the total budget for house construction in Malaysia. Material costs would typically account for 50-60% of the total cost to build a residential property, depending on specifications.

Here is an overview of prevailing prices for key building materials in Malaysia:

1. Cement