Property market turns pessimistic amid Middle East crisis: NUS
International political headwinds are casting a shadow over Singapore’s real property industry, according to the most recent Property Sentiment Index (Resi) released by the National University of Singapore (NUS). The Composite Sentiment Index dipped to 4.9 in 1Q2026, from 5.8 in the last quarter.
Nevertheless, sentiment in the prime housing market has lightened. Whilst the segment held a positive current final balance of 5% in 1Q2026, the figure is a noticeable decrease from the 41% logged in the previous quarter. “The prime residential field is inherently a lot more conscious changes in global resources and international buyer notion,” notes Qian.
Offices fared relatively much better. While the industry’s existing net balance slid to 0% from the 12% in 4Q2025, low Grade A vacancy and a restricted upcoming supply pipeline are anticipated to bolster this sector, mirrored in a positive future expectation of +15%.
“With the Composite Index sliding beneath the neutral limit, it is clear that the sector is moving from an expansionary mindset to one of defensive consolidation as businesses shift into a ‘risk-off’ stance,” claims Qian.
Survey results suggested 50% of property developers expect higher rates for brand-new home start for the following six months, whilst 60% predict start quantities to hold firm, sustained by resilient purchaser demand.
It makes up a Current Sentiment Index and a Future Sentiment Index, which record modifications within the previous six months and the following 6 months, specifically. Scores from both indices are aggregated to obtain a Compound Index, that suggests general market view.
Both the current and future view indices fell in 1Q2026. The previous contracted to 4.9 from the past quarter’s 6.1. The latter slid to 5.0 from 5.5 in the preceding quarter.
Professor Qian Wenlan, supervisor of the NUS Ireus, connects the gloomy shift in the market to macroeconomic headwinds originating from the dispute occurring in the Middle East. “The continuous disaster in the Middle East– with its cascading effects on growing energy costs, relentless inflation, and raised rates of interest– has dampened property view right here in Singapore,” she explains.
Across commercial and industrial sections, sentiments extensively decreased. The business park and hi-tech area market led this downturn, posting a current internet equilibrium of -25% and a future net balance of -20%.
Made by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks impressions and assumptions of the real estate market through quarterly questionnaires of top execs in Singapore realty business.
Sentiment also fell in the retail and hospitality property markets. The prime retail and suburban retail sectors logged current net equilibriums of -20% and -15% for 1Q2026, while the hotel and serviced apartment segment had a present net equity of -15%.
Still, the residential housing industry stays secure, with respondents mirroring measured assurance in the country residential market. Throughout all realty segments, suburban household topped the listing with a positive current web equilibrium and future web equilibrium of +15% each.
