Property market turns pessimistic amid Middle East crisis: NUS
International political headwinds are casting a shadow over Singapore’s real estate market, according to the most up to date 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 adjustments over the prior 6 months and the next 6 months, specifically. Scores from both indices are accumulated to derive a Composite Index, which suggests overall market belief.
Workplaces fared fairly far better. While the market’s current net balance slid to 0% from the 12% in 4Q2025, low Grade A vacancy and a limited upcoming supply pipeline are anticipated to reinforce this section, shown in a positive future outlook of +15%.
Nevertheless, belief in the top residential market has actually lightened. Whilst the sector secured a positive current final balance of 5% in 1Q2026, the figure is a labeled decline from the 41% logged in the former quarter. “The prime residential field is inherently more sensitive to changes in global funding and international buyer sentiment,” indicates Qian.
Still, the domestic houses market remains steady, with participants reflecting gauged assurance in the rural household market. Across all real estate sectors, country non commercial topped the listing with a positive existing net equilibrium and future web balance of +15% each.
Professor Qian Wenlan, director of the NUS Ireus, connects the gloomy turn in the market to macroeconomic headwinds originating from the problem happening in the Middle East. “The recurring disaster in the Middle East– with its plunging results on surging power costs, persistent inflation, and high rate of interest– has dampened property sentiment below in Singapore,” she explains.
Both the current and future view indices fell in 1Q2026. The former contracted to 4.9 from the previous quarter’s 6.1. The last slid to 5.0 from 5.5 in the preceding quarter.
Study results shown 50% of developers anticipate greater costs for brand-new household launches for the following six months, whilst 60% anticipate start volumes to hold firm, supported by durable buyer need.
Sentiment also decreased in the retail and hospitality property markets. The prime retail and suburban retail segments logged current net balances of -20% and -15% for 1Q2026, while the hotel and serviced apartment segment had a present net balance of -15%.
Throughout commercial and industrial sections, views generally declined. The business park and hi-tech area market led this downturn, publishing a present internet equilibrium of -25% and a future net balance of -20%.
“With the Composite Index slipping below the neutral limit, it is clear that the market is changing from an expansionary mindset to one of protective consolidation as services shift right into a ‘risk-off’ position,” claims Qian.
Produced by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks assumptions and assumptions of the real estate market through quarterly surveys of senior execs in Singapore realty firms.
