Property market turns pessimistic amid Middle East crisis: NUS
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 estate industry via quarterly studies of top execs in Singapore realty business.
Nonetheless, belief in the top residential market has lightened. While the sector held a positive current final balance of 5% in 1Q2026, the number is a noticeable decrease from the 41% logged in the previous quarter. “The prime residential sector is inherently a lot more conscious shifts in global capital and global buyer notion,” mentions Qian.
Workplaces fared reasonably better. While the market’s existing net balance slid to 0% from the 12% in 4Q2025, low Grade A vacancy and a constrained upcoming supply pipeline are anticipated to bolster this sector, shown in a favorable future outlook of +15%.
Sentiment also decreased in the retail and hospitality property markets. The prime retail and suburban retail sections logged current net balances of -20% and -15% for 1Q2026, whilst the resort and serviced apartment segment had a current net equity of -15%.
“With the Composite Index slipping below the neutral threshold, it is clear that the market is shifting from an expansionary mindset to among defensive consolidation as businesses change right into a ‘risk-off’ standpoint,” states Qian.
Throughout commercial and industrial segments, beliefs generally decreased. The business park and hi-tech room industry led this downturn, posting a present web balance of -25% and a future net balance of -20%.
Both the present and future view indices fell in 1Q2026. The past contracted to 4.9 from the previous quarter’s 6.1. The last slipped to 5.0 from 5.5 in the preceding quarter.
Global political headwinds are casting a shadow over Singapore’s realty industry, according to the most up to date 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.
Teacher Qian Wenlan, supervisor of the NUS Ireus, connects the depressed move in the market to macroeconomic headwinds stemming from the conflict happening in the Middle East. “The continuous crisis in the Middle East– with its cascading effects on growing power costs, consistent inflation, and raised rate of interest– has actually dampened property view here in Singapore,” she explains.
Survey results suggested 50% of property developers anticipate greater prices for new residential launches for the next six months, whilst 60% anticipate start quantities to hold firm, supported by resilient buyer demand.
Still, the domestic houses industry continues to be secure, with respondents reflecting determined trust in the rural household market. Throughout all real estate sectors, rural property covered the listing with a positive existing net equilibrium and future net balance of +15% each.
It makes up a Current Sentiment Index and a Future Sentiment Index, that track modifications within the previous 6 months and the following six months, specifically. Scores from both indices are accumulated to derive a Composite Index, which shows overall market sentiment.
