The recent decline in sentiment within Singapore’s private real estate market underscores growing uncertainty among industry leaders. The sentiment index plummeted from 6.0 in the fourth quarter of 2024 to 4.3 in the first quarter of 2025, marking the end of a five-quarter upward trend that had previously buoyed hopes within the sector. This downturn reflects the increasing anxiety surrounding both local and global economic conditions, particularly influenced by the implications of recent global trade policies.
A striking 88% of real estate executives now perceive a global economic slowdown as the primary risk to their business, a significant increase from 70.4% in the previous quarter. This heightened concern can largely be attributed to the impact of tariffs imposed under the Trump administration, which have raised fears about job losses and a potential downturn in the domestic economy.
The sentiment regarding tariffs has intensified, with the percentage of executives concerned about their economic repercussions surging from 29.6% to a worrying 70.8%. This shift illustrates a palpable sense of trepidation as stakeholders grapple with the realities of escalating trade tensions.
The negative outlook is especially pronounced within the industrial and logistics property sectors, where sentiment has dramatically shifted by 36 points. The initial positive sentiment, which stood at 11%, has spiraled into a negative outlook of -25%. This notable decline reflects the broader implications of reduced trade activity and potential disruptions in supply chains, which are critical for the performance of industrial properties.
As global trade slows, so too does demand for logistics and warehousing spaces, leading to an evident retreat in sentiment.
The office sector has also experienced a decline in confidence, with the outlook deteriorating from a neutral 7% to a more pessimistic 25%. This decline suggests that industry leaders anticipate a contraction in office space demand, potentially fueled by an increase in remote working arrangements and a general wariness about economic stability.
As businesses reevaluate their needs in light of changing market conditions, the repercussions for the office real estate sector may be significant.
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News Source: Edgeprop
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