Cost Overrun in Residential Construction Project in Malaysia: Causes and Improvement Measures


  • Syafika Artika Rahim
  • Syuhaida Ismail
  • Abd Latif Saleh


Cost overrun is the major issue in residential construction project industry worldwide, including Malaysia. This paper is therefore aimed to appraise the cost overrun in residential construction project in Malaysia. This paper was done based on findings by reviewing a thorough review of literature and expert focus group interview on the current practice of residential construction projects from local and global context. The previous study reveals that many residential construction projects are facing various types of problems, especially cost overrun that eventually affected most of the construction project completions. It is found that the cost overrun in residential construction project was caused by improper planning and scheduling by contractor, inconsistency in price materials, unanticipated site conditions, incompetent contractor, sudden change in the scope of the project, project financial difficulties, poor management and supervision of construction site, and lack of site workers. Hence, it is important to examine the improvement measures of the cost performance in residential construction project in Malaysia of which include proper planning and scheduling of project, adequate site management and supervision, effective strategic planning and appropriate construction method used in the project. This paper could serve as a guide to the project management team, who involves in Malaysia residential construction project to maximize the cost performance in the project and thus shall support the Construction Industry Transformation Programme (CITP) Malaysia’s national agenda.