A woman salvages bricks from a demolished building in Yangon. Pic: Myanmar Times archive

HOUSES marked for demolition to make way for high-rise buildings have risen by as much as 40 percent in the past year, several industry sources said last week.

The reason, said U Aung Tun, the managing director of MTP Construction, is that construction material prices have also risen over the past year, which has pushed up the value of salvaged bricks, wood and metal. He said prices for these condemned houses have increased by as much as 40pc in the last year.
“The increased price of construction materials is the main reason why these old houses are increasing in value. Bricks cost double what they were last year and other materials, such as wood and steel, have increased by 20 to 25pc in price,” U Aung Tun said.

He said that the salvaged materials are rarely recycled for use in the new project but are instead used to build cheap housing on the outskirts of Yangon, where the house owners cannot afford to buy new materials.

U Tint Lwin, who often buys old houses marked for demolition, said there is a high demand for salvaged products because they are much cheaper than new materials.

“One tonne of recycled pyin-ka-do wood is only half the price of new timber and you can get two old bricks for the same cost as one new one,” he said.

But not all of the salvaged products return to the housing market. U Tint Lwin said some of it is used to build warehouses and some is sold for use within the furniture industry.

He added that the best areas to find such houses are Latha, Pabedan, Sanchaung and Kyauk Myaung townships, where there is plenty of new high-rise buildings going up.

However, he did not agree with U Aung Tun that house prices have risen by 40pc, saying that it was more like 20pc.

“Every rainy season there is a shortage of bricks and this one is no different. Even recycled bricks cost K10 more now than what they were in May,” he said.
New bricks, however, are double the price they were in May.

U Tin Aung, another buyer of soon-to-be-demolished houses, put the increase in house prices at 15pc but agreed that the increase in raw material prices was driving the market.

“One tonne of new pyin-ka-do wood and teak are K800,000 and K1.4 million respectively. But if you buy 1 tonne of recycled wood it’s only K550,000 for pyin-ka-do and K800,000 for teak,” he said.

He said that the average value of a 1500-square-foot house, depending on how many storeys it had and the condition of the wood, bricks and steel inside, would probably be worth between K4 and K10 million.