Property market turns pessimistic amid Middle East crisis: NUS
International political headwinds are casting a shadow over Singapore’s real property market, according to the most recent Property Sentiment Index (Resi) presented by the National University of Singapore (NUS). The Composite Sentiment Index dipped to 4.9 in 1Q2026, from 5.8 in the very last quarter.
Both the present and future view indices fell in 1Q2026. The previous contracted to 4.9 from the past quarter’s 6.1. The last slipped to 5.0 from 5.5 in the preceding quarter.
It makes up a Current Sentiment Index and a Future Sentiment Index, that record changes within the prior 6 months and the next six months, respectively. Scores from both indices are aggregated to derive a Composite Index, which indicates total market sentiment.
Nava Grove Pine Grove and Ulu Pandan area
Still, the residential houses industry continues to be stable, with participants showing measured confidence in the country residential market. Across all real estate sectors, country residential topped the list with a positive existing web balance and future net balance of +15% each.
“With the Composite Index slipping beneath the neutral threshold, it is clear that the industry is shifting from an expansionary mindset to one of defensive consolidation as companies shift right into a ‘risk-off’ stance,” states Qian.
Belief also decreased in the retail and hospitality real estate markets. The prime retail and suburban retail sections logged current net equilibriums of -20% and -15% for 1Q2026, while the hotel and serviced apartment segment had a present net balance of -15%.
Study results indicated 50% of developers expect higher costs for brand-new household launches for the next 6 months, whilst 60% predict launch volumes to hold firm, sustained by resistant customer demand.
Across business and industrial segments, sentiments broadly declined. The business park and hi-tech space industry led this downturn, uploading a present net equilibrium of -25% and a future net balance of -20%.
Nonetheless, sentiment in the top residential market has relaxed. While the section secured a favorable current net balance of 5% in 1Q2026, the number is a noticeable decline from the 41% logged in the former quarter. “The prime residential field is inherently much more sensitive to changes in global capital and international buyer notion,” mentions Qian.
Professor Qian Wenlan, supervisor of the NUS Ireus, attributes the pessimistic turn in the market to macroeconomic headwinds coming from the dispute happening in the Middle East. “The continuous crisis in the Middle East– with its plunging results on surging power charges, relentless inflation, and high rates of interest– has dampened property sentiment right here in Singapore,” she explains.
Offices fared fairly far better. Whilst the field’s existing net balance slid to 0% from the 12% in 4Q2025, low Grade A vacancy and a limited upcoming supply pipeline are expected to strengthen this sector, shown in a favorable future overview of +15%.
Produced 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 with quarterly questionnaires of top execs in Singapore real estate firms.
