Property market turns pessimistic amid Middle East crisis: NUS
Across commercial and industrial segments, beliefs extensively declined. The business park and hi-tech space market led this downturn, posting a present internet balance 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 perceptions and expectations of the property market through quarterly studies of top executives in Singapore realty firms.
It comprises a Current Sentiment Index and a Future Sentiment Index, that record modifications within the prior six months and the next six months, specifically. Scores from both indices are accumulated to derive a Composite Index, that suggests general market sentiment.
Global political headwinds are casting a shadow over Singapore’s realty market, according to the most up to date Real Estate Sentiment Index (Resi) published by the National University of Singapore (NUS). The Composite Sentiment Index plunged to 4.9 in 1Q2026, from 5.8 in the very last quarter.
Still, the domestic housing industry remains steady, with participants reflecting gauged trust in the rural non commercial market. Throughout all realty sections, rural residential topped the list with a positive present net equilibrium and future internet equilibrium of +15% each.
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.
Study results indicated 50% of property developers expect higher costs for new property start for the next six months, while 60% predict launch quantities to hold firm, supported by durable customer demand.
“With the Composite Index sliding beneath the neutral threshold, it is clear that the industry is moving from an expansionary mindset to among defensive consolidation as organizations change into a ‘risk-off’ stance,” says Qian.
Offices fared relatively much better. While the market’s current net balance slid to 0% from the 12% in 4Q2025, low Grade A vacancy and a restricted upcoming supply pipeline are anticipated to boost this section, reflected in a favorable future outlook of +15%.
Professor Qian Wenlan, director of the NUS Ireus, connects the pessimistic move in the industry to macroeconomic headwinds coming from the dispute occurring in the Middle East. “The recurring crisis in the Middle East– with its cascading results on surging energy costs, consistent inflation, and raised interest rates– has dampened property sentiment here in Singapore,” she explains.
Nonetheless, belief in the top residential market has softened. While the segment held a favorable current final balance of 5% in 1Q2026, the number is a noticeable decline from the 41% logged in the previous quarter. “The prime residential field is naturally much more conscious changes in global resources and worldwide buyer notion,” indicates Qian.
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 hotel and serviced apartment segment had a current net equity of -15%.
