NUS survey: suburban home sentiment turned negative as OCR new sales rose 63%

Senior property executives turned negative on suburban private homes in the second quarter of 2026. In NUS Real Estate's Real Estate Sentiment Index (RESI), the current net balance for suburban residential property fell from +15% to -14%, even though the overall composite index rose from 4.9 to 5.6 12. The Business Times reported the survey on 24 September 2026 15.

The two readings do not contradict each other. Sentiment improved across most of the market, led by offices, and suburban housing was one of only three segments with a negative current balance 1. For a household weighing a suburban condo, the more useful question is what the gloom rests on. Official sales, price and lending data answer part of it, and they point somewhere different from the headline.

What the NUS survey measured

RESI is a quarterly survey of senior executives at developers, consultants, financial institutions, professional firms and service providers 1. Its indices run from 0 to 10, from pessimism to optimism. The current index covers the past six months and the future index the next six 1. Each sector is scored as a net balance: the share of respondents choosing a positive option minus the share choosing a negative one 1.

In the second quarter, the current index rose from 4.9 to 5.6, the future index from 5.0 to 5.5, and the composite from 4.9 to 5.6 1. That was a rebound: the composite had fallen from 5.8 to 4.9 in the first quarter 2.

The sector readings show where the mood split 12.

Office recorded the highest balance on both measures, and prime retail the lowest future balance 1. Suburban residential fell 29 points on the current measure, from +15% to -14%, and 20 points on the future measure, from +15% to -5% 12. Prime residential held a positive current balance of +9% but turned to -14% on the outlook 12.

Why the executives turned cautious

The survey asks respondents to name the risks for the next six months. A global economic slowdown and rising inflation or interest rates were cited by 81.8% of respondents each 1. Rising rates had been named by 80.0% in the first quarter and 11.8% in the fourth quarter of 2025 2. Job losses or a decline in the domestic economy stayed at 59.1%, against 60.0% in the first quarter 1. Rising construction costs fell from 65.0% to 45.5%, and the risk of new demand-side cooling measures fell from 40.0% to 13.6% 1.

Developers were also asked about new-launch prices over the next six months. Half expected them to stay the same, 30% expected moderately higher prices and 20% moderately lower ones 1.

The NUS release itself does not discuss affordability. The closest point is a respondent's comment that uncertainty around job security may limit how far prices can rise 1. In the release, Professor Qian Wenlan, the Ng Teng Fong Chair Professor in Real Estate at NUS, credits the rebound to a better economic outlook and to commercial space 1. The affordability explanation comes from her remarks reported by The Business Times. She said affordability had become a heavier constraint on suburban homes, with new-launch prices reaching new highs amid tight supply 15. She put the split between prime and suburban sentiment down to demand resistance, supply pressure and policy changes 15.

The Business Times also reported her pointing to higher income ceilings for BTO flats and executive condominiums, which may reduce the urgency for some households to buy a suburban private home 15.

What the sales and price data show

Official data for the same quarter gives a steadier picture. The survey does not define its prime or suburban segments in URA's terms 1. As an editorial choice, this article compares suburban sentiment with URA's Outside Central Region and prime sentiment with its Core Central Region. URA's overall private residential price index rose 0.5% in the second quarter, after 0.9% in the first 5. Non-landed prices in the Outside Central Region (OCR) slipped 0.1%, after rising 2.2% in the first quarter; the OCR index went from 271.4 to 271.1 56. Core Central Region (CCR) prices rose 1.8%, from 158.6 to 161.5, and Rest of Central Region (RCR) prices fell 1.2% 6.

Sales moved the other way from sentiment. Developers sold 1,494 new homes in the OCR in the second quarter, up from 916 in the first quarter and 266 a year earlier 7. Across Singapore they sold 2,141 new homes, excluding executive condominiums 5. On those figures, the OCR took about 69.8% of new sales, and its new sales rose 63.1% in a quarter (1,494 divided by 916) 57.

Sources for the table: RESI reports for each quarter 3421; URA price and transaction data 57.

Across the two quarters where both series are available, sentiment fell as OCR price growth stalled, even though new sales rose 1257. That is consistent with executives reacting to prices rather than to sales volume, but two quarters cannot establish a pattern, and Professor Qian gave other reasons 15. RESI's current index also looks back six months, while URA's figures cover the calendar quarter 15. The survey runs in the last month of each quarter and gives no exact dates 1.

Other OCR indicators were soft rather than weak. OCR non-landed rents fell 0.3% and OCR vacancy rose from 5.2% to 5.6% 5. Across Singapore, unsold private homes with planning approval, including executive condominiums, stood at 15,810 5. For HDB upgraders, the other side of the trade was flat: HDB's resale price index was 202.8 in the second quarter, down 0.3% on the quarter and 0.05% below its 202.9 a year earlier 8.

How many people moved the number

NUS does not publish the number of respondents 1. The percentages allow an estimate. Every risk share and net balance in the second-quarter report is a whole-number share of 22: 81.8% is 18 of 22, 59.1% is 13 of 22, 45.5% is 10 of 22, and 13.6% is 3 of 22 1. The developer-only questions are answered by a smaller group 1. The first-quarter risk shares and net balances all move in steps of 5%, which fits a panel of 20 2.

On that reading, suburban residential went from a net three respondents on the positive side to a net three on the negative side: a swing of about six people. Office's +36% is a net eight 1. Panels of 44 or 66 would fit the same percentages, so 22 is the smallest panel consistent with every risk share and net balance, not a confirmed count.

This does not make the survey wrong. Its respondents are senior executives at developers, financial institutions, consultancies and other property firms 1. It does mean a large quarterly swing can come from a handful of people, and part of it may reflect a change in who answered. The survey is best read as a signal from well-placed insiders, checked against transaction data.

Rates: the fear and the path

Rising rates were the joint-top risk, but domestic borrowing costs are lower than a year ago. The three-month compounded SORA was 1.2312% on 29 September 2026, against 1.4571% a year earlier: 0.2259 percentage points lower 10. It has risen 0.2130 points since 1.0182% on 29 April 2026, the lowest reading between August 2025 and September 2026 10. MAS put bank fixed-rate mortgage packages at about 1.5% in the second quarter of 2026, down from 2.5% a year earlier 11.

The worry is about what comes next, and it is shared. MAS said in its September 2026 Financial Stability Review that rising global interest rates could tighten domestic financial conditions, and it urged households to be cautious about taking on leverage 11.

What the loan rules mean for a median household

Cheaper mortgages make repayments smaller 11. They do not always raise how much a household may borrow, because the borrowing test has a 4% floor 1113.

Under MAS rules, a borrower's total monthly debt repayments may not exceed 55% of gross monthly income, the Total Debt Servicing Ratio (TDSR) (MAS, rules as at 30 September 2026) 12. For residential property loans, the test uses the higher of 4% a year or the "thereafter" rate, the highest rate the bank offers at any time during the loan's tenure 13. While that rate stays below 4%, the floor applies 13. MAS noted in its September review that this 4% floor still limits how much borrowers can take on, even with market rates lower 11.

The median resident household earned $12,446 a month in market income in 2025 9. Market income includes non-work income and is counted before taxes and transfers 9. Banks assess income differently: employer CPF contributions are excluded and variable and rental income take a haircut of at least 30% 13. The table works this through the rules, with the full income pledged to one 30-year loan and no other debts.

Inputs: household income 9; repayment limit 12; test rate 13; market rate 11. Repayments use the standard monthly annuity formula.

For a borrower with no outstanding housing loan, on a tenure of up to 30 years that ends by age 65, the loan-to-value (LTV) limit is 75% (MAS, rules as at 30 September 2026) 14. A loan of $1,433,825 therefore corresponds to a purchase of about $1,911,767 14. That assumes the household can pay the remaining 25% of the price itself, including at least 5% of the price in cash 14.

The official rules do not prove Professor Qian's point, but they show one mechanism consistent with it. While the 4% test rate sits well above market rates, a household's loan limit is set by its income, not by the interest rate it pays 1113. The estimate ignores other debts and bank haircuts on variable income 13, and the tighter limits for older borrowers, second loans and tenures beyond 30 years 14.

Who is affected, and who is not

Buyers of suburban condos, including HDB upgraders, face a market that has stopped rising rather than one that has turned 5. OCR non-landed prices were flat in the second quarter while new sales grew 57. For them, one limit that lower rates do not ease is borrowing capacity, which depends on income while the 4% test rate applies 1113.

Owners who plan to sell a suburban condo face a slightly higher vacancy rate, with OCR vacancy up from 5.2% to 5.6%, while developers sold more new homes in the OCR 57. Sellers of HDB flats who want to upgrade saw little change in resale prices over the year 8.

The picture for prime homes is mixed. The survey's current balance for prime residential rose from +5% to +9% 12, and CCR non-landed prices rose 1.8% 56. But executives turned negative on the outlook, with prime residential at -14% on the future measure 12.

What to watch next

URA's flash estimate for the third quarter of 2026 is due on 1 October 2026, with the full third-quarter figures on 23 October 2026 16. Those will show whether OCR prices kept flattening while sales held up. The next RESI will cover the third quarter; last year's third-quarter report was posted in November 4. MAS publishes SORA daily, so the path of borrowing costs can be followed as it moves 10.

If OCR prices resume rising in the third-quarter data, the survey's second-quarter gloom may prove short-lived. If prices soften while new sales stay high, the executives may have seen it first.