Property market turns pessimistic amid Middle East crisis: NUS
Workplaces fared reasonably far better. While the field’s present net balance slipped to 0% from the 12% in 4Q2025, low Grade A vacancy and a limited upcoming supply pipeline are expected to bolster this section, shown in a positive future outlook of +15%.
International political headwinds are casting a shadow over Singapore’s real estate industry, according to the current 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 very last quarter.
Throughout commercial and industrial segments, beliefs extensively decreased. The business park and hi-tech area market led this downturn, uploading a current net equilibrium of -25% and a future net balance of -20%.
Newport Residences City Developments (CDL)
Professor Qian Wenlan, director of the NUS Ireus, attributes the depressed shift in the industry to macroeconomic headwinds stemming from the conflict happening in the Middle East. “The continuous crisis in the Middle East– with its cascading results on climbing power costs, persistent inflation, and elevated rate of interest– has dampened property sentiment here in Singapore,” she explains.
It comprises a Current Sentiment Index and a Future Sentiment Index, that monitor modifications over the past six months and the following six months, specifically. Scores from both indices are aggregated to derive a Compound Index, which suggests overall market belief.
Survey results suggested 50% of developers expect greater prices for new home start for the next six months, whilst 60% anticipate launch volumes to hold firm, sustained by durable buyer demand.
Still, the domestic home market remains secure, with participants reflecting measured trust in the rural household market. Across all property sectors, country property topped the list with a positive existing net balance and future net balance of +15% each.
Sentiment also decreased in the retail and hospitality real estate markets. The prime retail and suburban retail sections logged current net balances of -20% and -15% for 1Q2026, while the resort and serviced apartment segment had an existing net balance of -15%.
Both the present and future view indices tumbled in 1Q2026. The previous contracted to 4.9 from the past quarter’s 6.1. The last slid to 5.0 from 5.5 in the preceding quarter.
“With the Composite Index slipping below the neutral limit, it is clear that the market is moving from an expansionary mindset to one of defensive consolidation as businesses shift right into a ‘risk-off’ standpoint,” says Qian.
Generated by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks assumptions and expectations of the property market through quarterly surveys of senior executives in Singapore realty business.
Nonetheless, sentiment in the prime residential market has actually softened. Whilst the segment secured a favorable current final balance of 5% in 1Q2026, the figure is a noticeable decline from the 41% logged in the former quarter. “The prime residential sector is naturally more sensitive to shifts in global funding and global buyer notion,” mentions Qian.
