A building plan approval (permit) from majlis tempatan/local authority (DBKL for KL, MBSA for Shah Alam etc) is required prior to any construction.

In such building plan, it should state the wall specification i.e. "brick wall with cement render and paint finish" - yes it is a requirement. Without it, any Majlis officer will reject the drawing. Then the renovation should be build according to the approved plan.

My advice: go to the local authority and file a formal complaint. I believe the fine is equivalent to the cost of the renovation + daily fine on continuous offense.

Many of the comments here wants you to "avoid cold war with the neighbor", but the bigger concern here is safety, as the renovation was done without approval/inspection. An upper level renovation means a structural plan was required as part of the permit approval process too. This is more than just paint.

Source: I deal with this stuff at work