Govt announced the 6% SST on construction contracts for all non-residential projects.

This 6% SST on construction amounts to at least 3% of GDV....

Take this new SST. Next coming tax will be the Carbon tax on steel products - impact not sure yet.


But means overall will see developers incurring at least 3-5% more.

No impact to residential boss?

6% sst impact 3% gdv

Means developer margin is 50% lo

1000 unit, sell 500 already cover all costing

lol u wish....

construction cost averages at 50+% of GDV


then theres consultant fees... about 8-10% of GDV
authority fees (IWK, planning, DO, BP etc) around 10% of GDV
sales and marketing cost... say 5%

not forgetting land cost.... say 10% of GDV

take all the above, add in financing cost about 5%...


developer makes a gross of 10+%

Cannot be low la 10%..
Maybe for entry level developer.
Nowadays those got name one probably running near 20%

can.... u buy the land since many years ago lor, then land cost cheaper.

Pardon siudai to point out the time line

Even at 30% nett profit for the entire project it will take 48 mths for normal high rise to be completed nowadays if the project is huge.

Planning stage is easily 1yr if the developer is efficient.

So 30% / 5yrs = 6% per annum.

Can be higher can be lower.

It's nvr gonna be 20% or lower to be honest.

Don't forget certain developments are riding on the hype of the particular location. Hence, the higher margin.

When siudai mentioned about the lower margin, very like is the holding cost for unsold units over the years till vp which might lead to bigger discount.

There are developments that sold out in short span of time or very minimal holding of units with higher selling price upon disposal to compensate the holding costs.

End day it's more of the strong ones win more the weak ones got wiped out automatically.

There is no charity in business. If developer can sell well, don't expect they are friendly type. On the other hand, if developers are not making money then it's best not to commence till the Econ favours them in terms of pricing. Who would wanna run a losing business right?

This post has been edited by ManutdGiggs: Jun 12 2025, 10:47 AM

Just curious if those service apartments projects under commercial title or HDA with commercial would be impacted?

lol... your timeline very optimistic already.

nowadays...

day 1 land purchase

planning, thoughts, design, marketing study ..... 3-4 months

submission for DO until DO approval.... 3 months

submission for BP until approval.... another 3 months

SiFus / AP / DL .... another 2-3 months

KPKT extension (say from 36 months to 48/54 months) .... another 1-2 months

construction itself... including piling - averagely 36-42 months (depends on how high)

authority clearances, TNB, IWK, Bomba, CCC.... about 4 months in total

strata title application.... 3-6 months


from land purchase til VP.... 66 months averagely. n even at VP.... your billing is still not 100% yet, still got stakeholders sum, HDA deposit etc...

wait another 24 months to collect balance money back

as of now , only RESIDENTIAL titled properties are exempted.

All others kena

My apology big bossi siudai forgotten to mention the lands are already in pocket liao. So the time line shown is actually the commencement of planning stage 😁

And the DLP shouldn't be included as the final collections are considered safe in kocek unless the developers are cutting corners which will eventually lead to another issue.

So basically I would agree to lengthen the time line to 6 full years rather than 5 years.

So 5% now uun uun jiak mi hoon 🤩

Bossi bossi

Resi exempted in charging sst but the confusing part is will sst being waived on those materials meant for resi developments???

Yea.. u r right.. where got developer do so big project with huge risk for just 10%

Last time i ask uoa one, the contractor sendiri say at least got 40% profit margin..
All is sell 60% , the other 40% is prepare for gross profit

You are not in development business.

This is not realistic lah. I have developer clients. In the past (10 to 15 yrs ago) for JV projects - gross profit was 30%. Now best case is 15% if sell all. We will definitely see a slowdown in launches as developers unsure of how to price their products. For strong developers with existing landbank (eg. former plantation land acquired decades ago),they are safer and can continue to launch since they got big buffer. For small developers, these are tough times. Expect to see even higher density high rises to keep costs lower and smaller size units. Development business is now high risk and lower reward.

Subsale included, right?

Now still doable with higher density. Tats is why u see condo reaching level 60.

Last time punya condo is lvl 20 till 30 best case.
Now punya condo is level 40 to 60.
So the margin still there one when the land office give them plot ratio adjustment..

If 10% margin for 5 yrs, makan taik lo. How to fund for future land bank?

If 8 to10% for 1 yr and project is going for 4 5 yrs, then ok la..
So 5 yrs × 8% = 40% make sense

thanks TS you share some really good insights

Hi boss

Eric is actually in construction industry

Highly related to development

This post has been edited by ManutdGiggs: Jun 12 2025, 02:25 PM

Km in 3 months, BP in 3 months?! Realistic or not.


This post has been edited by icemanfx: Jun 12 2025, 02:27 PM