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Has Singapore's property bubble already burst?

Roslan Rahman | AFP | Getty Images

Despite dire predictions of sharp drops, Singapore's property prices don't seem to have budged much, but statistics may mask a market already in deep decline.

The official price index data appear largely benign, down just 0.7 percent in the third quarter, for a cumulative decline of less than 4 percent from the peak in 2012.

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But that's the wrong price data to look at, said Alex Shlaen, a property investor and CEO of Panache Management, a luxury brand manager.

The price index rolls in prices across various classes of properties, including the mass-market segment, more geared toward end-users, with luxury properties, where investors appear to be turning up their nose at higher prices.

While many analysts cite property price gains from 2009 when the index hit its financial crisis nadir, Shlaen believes the high-end never really recovered after hitting a pre-financial crisis peak in 2008.

"2009 was a cardiac arrest. If you compare the high-end property prices of 2007 with now, the market is substantially down," he said, estimating luxury property prices are off 30-50 percent from their peak.

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It's not a view entirely borne out by median prices in Singapore's "core central region," where many of the city-state's luxury properties are located. The median price for uncompleted properties in the area peaked at 18,369 Singapore dollars ($14,691) per square meter (psm) in the first quarter of 2008, a level it hasn't retested, compared with the median price of 16,149 Singapore dollars psm in the third quarter of this year.

But overall, median prices for both completed and uncompleted properties in the area peaked at 15,461 Singapore dollars psm in the first quarter of 2008, touched a nadir of 11,161 Singapore dollars psm in 2009, before hitting a high of 16,629 Singapore dollars psm last year. In the third quarter of this year, the median was 15,679 Singapore dollars psm.

But Shlaen cited one of his properties in the Cairnhill area, noting the bank valued the property at around 5.3 million Singapore dollars ($4.24 million) at the end of 2007, compared with another valuation of around 4.3 million Singapore dollars this month, although he doesn't believe he'd get that much if he sold.

One problem with looking at the sales prices to determine the health of Singapore's luxury market is that not many sales are coming through. In the third quarter of this year, the total number of units sold dropped by 43 percent on-quarter to the lowest since the fourth quarter of 2008.

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Inquiries about buying Singapore property have dropped by as much as 70 percent from high-net-worth clients, said Chandran V.R., managing director at property agent CRE.

While long-term investors are interested, "sellers are not budging," he said. While developers are offering freebees and discounts, "the top-tier sellers are all holding back in the core central region."

But while Chandran noted that outside the central region, sellers without holding power may be dumping, it isn't certain the standoff between bargain-hunting buyers and hold-out sellers is going to be resolved in buyers' favor.

"You're hitting rocks already on how much prices can go down without going into negative margins" for developers, said Alan Cheong, senior director for Singapore at Savills Research. While developers may take paper write-downs, "they aren't willing to lose money on a project," he said.

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Cheong blames all the dire predictions that the city-state's property prices will fall by as much as 20 percent for the logjam, adding the predictions aren't realistic.

"It's not like a stock price. These are hard assets. These are not liquid assets like equities," he said. Cheong expects demand to return next year as buyers watch their savings build up, increasing affordability, even as prices remain stable.

"They will lose patience [waiting for price declines] and reenter the market," he said.

—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1