Property market turns pessimistic amid Middle East crisis: NUS
Sentiment also dropped 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, whilst the resort and serviced apartment segment had a current net balance of -15%.
Across business and industrial sectors, beliefs generally decreased. The business park and hi-tech area industry led this downturn, uploading an existing internet balance of -25% and a future net balance of -20%.
However, sentiment in the prime residential market has actually relaxed. Whilst the section secured a positive current final balance of 5% in 1Q2026, the number is a marked decrease from the 41% logged in the former quarter. “The prime residential field is naturally a lot more conscious changes in global capital and global buyer sentiment,” mentions Qian.
Generated by NUS’ Department of Real Estate and Institute of Real Estate and Urban Studies (Ireus), the Resi tracks perceptions and assumptions of the real estate industry through quarterly studies of top execs in Singapore real property firms.
Study results suggested 50% of property developers anticipate higher prices for new property launches for the following 6 months, while 60% predict launch volumes to hold firm, supported by resistant purchaser need.
Global political headwinds are casting a shadow over Singapore’s realty market, according to the latest Realty Sentiment Index (Resi) presented 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.
Professor Qian Wenlan, supervisor of the NUS Ireus, associates the depressed turn in the business to macroeconomic headwinds stemming from the dispute happening in the Middle East. “The continuous situation in the Middle East– with its cascading impacts on climbing energy costs, consistent inflation, and raised interest rates– has dampened property view right here in Singapore,” she explains.
“With the Composite Index sliding below the neutral limit, it is clear that the industry is changing from an expansionary mindset to one of defensive consolidation as businesses change into a ‘risk-off’ position,” claims Qian.
Still, the residential home market stays steady, with participants reflecting gauged assurance in the country residential market. Across all real estate sectors, suburban non commercial topped the list with a positive existing internet balance and future net balance of +15% each.
Offices fared reasonably far better. While the sector’s present net balance slipped to 0% from the 12% in 4Q2025, low Grade A vacancy and a restricted upcoming supply pipeline are anticipated to bolster this segment, shown in a favorable future expectation of +15%.
Both the present and future sentiment indices fell in 1Q2026. The former 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 comprises a Current Sentiment Index and a Future Sentiment Index, which monitor adjustments over the prior six months and the next 6 months, specifically. Scores from both of these indices are accumulated to derive a Compound Index, that indicates overall market sentiment.
