As the slowdown in Singapore's housing market deepens, investors are questioning when the government may relax its anti-speculation curbs.
Private residential prices in the city-state dipped 1.1 percent on quarter in the April-to-June period, according to a flash estimate released by the Urban Redevelopment Authority (URA) on Tuesday, marking three consecutive quarters of falling prices. Prices fell 1.3 percent and 0.9 percent in the previous two quarters.
And a host of factors including increased supply, rising mortgage rates and a weak rental market are expected to push property prices lower over the course of 2014-2015.
"Combined, we believe these [factors] will exert further pressure on property prices in the mid-term," Tan Xuan, analyst at Malaysia-based lender CIMB wrote in a note.
CIMB forecasts prices to fall 10-15 percent over this period, while Barclays expects a 5-15 percent decline in 2015.
Despite the looming risk of a correction, analysts say the government is unlikely to take its foot off the break until next year, citing recent comments by the Ministry of National Development (MND).
On Monday, the MND said it's still too early to roll back property cooling measures given prices have remained relatively stable even though home sales have declined.
"Any reversal of policy measures in 2014 remains unlikely in the context of the moderate price declines that have played out thus far," said Adrian Chua, analyst at Citi.
Since 2009, the government has imposed seven rounds of measures to cool the property market, including tighter loan requirements and higher stamp duty rates for buyers. However, they failed to take the heat out of the market.
While private home prices have eased in the recent months, they are still 57 percent above 2009 levels, according to Barclays.
Tricia Song, analyst at Barclays has also ruled out a rollback of cooling measures, noting that the MND's statement affirms her belief that "the government will only start unwinding measures when prices fall a steeper 10-15 percent, perhaps in 2015."
Singapore is home to one of the world's most expensive real estate markets, with the city's scarcity of land and popularity as an investment destination in the region precipitating a swift rise in prices over the past two decades.
As a result, many Singaporeans now feel they have been priced out of the market, making housing affordability a priority for the government.