Housing and Local Government Ministry (KPKT) has announced the continuation and expansion of the Rahmah Cement Scheme under the 13th Malaysia Plan (RMK13), allowing affordable housing projects nationwide to obtain cement at subsidised prices of up to 31.8% below market rates.
From this initiative, I learned that construction material costs remain one of the biggest challenges affecting affordable housing development in Malaysia, especially following the global energy crisis and ongoing geopolitical conflicts in West Asia. Rising material prices have increased development costs for builders and placed pressure on housing affordability, making government intervention increasingly important to stabilise the sector.
Housing and Local Government Minister Nga Kor Ming explained that the expanded Rahmah Cement Scheme now includes affordable housing projects supervised not only by the Federal Government, but also state governments and private developers. This reflects a broader national strategy to ensure the continuity of affordable housing supply despite global economic uncertainties.
I also learned that public-private collaboration is becoming a critical component in Malaysia’s housing ecosystem. The scheme, first introduced in 2023 through cooperation between KPKT and the Cement and Concrete Association of Malaysia (C&CA), demonstrates how government agencies and industry players can work together to reduce construction costs while maintaining housing quality.
Under the expanded programme, subsidised cement pricing will benefit major affordable housing initiatives including the People’s Residency Programme (PRR), projects under Syarikat Perumahan Negara Bhd (SPNB), Perbadanan PR1MA Malaysia (PR1MA) and various state housing schemes.
The pricing support is significant. Bulk cement will be offered at RM290 per tonne compared to the market price of RM425, representing a saving of 31.8% or RM135 per tonne. Meanwhile, 50kg bagged cement will be priced at RM17.50 per bag, almost 30% lower than the current market price of RM24.90. I learned that lowering input costs at this scale can substantially improve project feasibility and help developers maintain more affordable selling prices for homebuyers.
A total allocation of 1.6 million metric tonnes of cement has been earmarked to support RMK13’s target of delivering 500,000 affordable homes over the next five years. The government also indicated that the allocation could be increased by an additional one million metric tonnes if demand continues to rise, subject to ongoing negotiations and industry sustainability considerations.
The initiative has already shown measurable impact since its introduction. To date, 29 affordable housing projects involving 11,909 housing units have been approved under the scheme. More than 316,000 metric tonnes of bulk cement and over 1.56 million bags of cement have been supplied, generating estimated savings of RM45.8 million. This demonstrates how targeted subsidies on key construction materials can directly support housing affordability and reduce the risk of delayed or abandoned projects.
Another important lesson I learned is the growing emphasis on transparency and digital governance in public housing initiatives. Applications for the Rahmah Cement Scheme will now be fully digitised through the Housing Integrated Management System (HIMS) managed by the National Housing Department, helping to improve monitoring and reduce leakages.
Overall, the expansion of the Rahmah Cement Scheme reflects the government’s broader Housing Reform Agenda aimed at strengthening Malaysia’s affordable housing ecosystem. The initiative highlights how cost management, industry collaboration and digital oversight are increasingly necessary to ensure sustainable housing delivery amid ongoing global economic and geopolitical uncertainties.
Yao Mu Realty, based in Kuala Lumpur, Malaysia, specializes in industrial real estate for factories and land, delivering professional and efficient solutions.
Posted by Yao Mu Realty Sdn Bhd on 20 May 26
Malaysia