Property market turns pessimistic amid Middle East crisis: NUS
International political headwinds are casting a shadow over Singapore’s realty industry, according to the most recent Realty 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 last quarter.
“With the Composite Index slipping below the neutral threshold, it is clear that the industry is shifting from an expansionary mindset to among defensive consolidation as organizations change right into a ‘risk-off’ standpoint,” states Qian.
Produced by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks perceptions and expectations of the real property industry via quarterly surveys of senior executives in Singapore real property companies.
Across commercial and industrial sectors, sentiments extensively decreased. The business park and hi-tech room industry led this downturn, posting an existing net equilibrium of -25% and a future net balance of -20%.
Canberra Crescent Residences Singapore
Offices fared relatively 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 reinforce this segment, mirrored in a positive future outlook of +15%.
Sentiment also dropped 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 resort and serviced apartment segment had an existing net balance of -15%.
Study results shown 50% of developers anticipate greater prices for new residential start for the next 6 months, whilst 60% predict start quantities to hold firm, sustained by resistant buyer demand.
Still, the residential houses market stays stable, with participants reflecting gauged assurance in the country non commercial market. Across all real estate sectors, country household topped the list with a positive present internet balance and future net balance of +15% each.
Teacher Qian Wenlan, director of the NUS Ireus, connects the depressed turn in the industry to macroeconomic headwinds stemming from the conflict occurring in the Middle East. “The ongoing disaster in the Middle East– with its cascading impacts on climbing power costs, relentless inflation, and elevated rates of interest– has dampened property sentiment below in Singapore,” she explains.
It makes up a Current Sentiment Index and a Future Sentiment Index, that record changes over the past 6 months and the next six months, specifically. Scores from both indices are accumulated to derive a Composite Index, which shows general market belief.
However, belief in the top residential market has actually lightened. Whilst the section held 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 industry is naturally extra conscious shifts in global resources and international buyer sentiment,” indicates Qian.
Both the current and future sentiment indices fell in 1Q2026. The previous contracted to 4.9 from the past quarter’s 6.1. The latter slipped to 5.0 from 5.5 in the preceding quarter.
