Property market turns pessimistic amid Middle East crisis: NUS
Study results indicated 50% of property developers expect greater prices for brand-new household start for the next six months, while 60% predict start quantities to hold firm, sustained by resilient buyer demand.
Across commercial and industrial sections, sentiments generally declined. The business park and hi-tech room market led this downturn, publishing an existing net balance of -25% and a future net balance of -20%.
Global political headwinds are casting a shadow over Singapore’s realty industry, according to the current Property Sentiment Index (Resi) published by the National University of Singapore (NUS). The Composite Sentiment Index dipped to 4.9 in 1Q2026, from 5.8 in the last quarter.
It makes up a Current Sentiment Index and a Future Sentiment Index, that record changes over the prior 6 months and the following 6 months, specifically. Scores from both of these indices are accumulated to derive a Composite Index, that suggests total market belief.
Generated by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks impressions and expectations of the real estate market via quarterly questionnaires of top execs in Singapore real property business.
Nevertheless, sentiment in the top residential market has actually relaxed. Whilst the section held a positive current final balance of 5% in 1Q2026, the figure is a noticeable decrease from the 41% logged in the last quarter. “The prime residential industry is naturally extra sensitive to shifts in global funding and international buyer sentiment,” notes Qian.
“With the Composite Index slipping below the neutral limit, it is clear that the sector is shifting from an expansionary mindset to one of defensive consolidation as businesses change into a ‘risk-off’ standpoint,” claims Qian.
Both the current and future sentiment indices dropped in 1Q2026. The past contracted to 4.9 from the previous quarter’s 6.1. The last slipped to 5.0 from 5.5 in the preceding quarter.
Teacher Qian Wenlan, supervisor of the NUS Ireus, associates the pessimistic move in the industry to macroeconomic headwinds stemming from the conflict happening in the Middle East. “The continuous crisis in the Middle East– with its plunging effects on climbing power charges, persistent inflation, and raised interest rates– has dampened property sentiment below in Singapore,” she explains.
Offices fared reasonably better. Whilst the sector’s present net balance slipped to 0% from the 12% in 4Q2025, low Grade A vacancy and a limited upcoming supply pipeline are anticipated to boost this sector, shown in a favorable future expectation of +15%.
Still, the domestic housing market continues to be stable, with participants reflecting gauged assurance in the suburban residential market. Throughout all realty sectors, suburban property topped the listing with a positive existing internet balance and future internet balance of +15% each.
Sentiment also decreased in the retail and hospitality real estate markets. The prime retail and suburban retail sectors logged current net equilibriums of -20% and -15% for 1Q2026, while the resort and serviced apartment segment had a present net balance of -15%.
