Is Singapore's property market finally perking up?

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Home sales in Singapore may have surged to a two-year high in July but analysts remain skeptical that the market has gotten out of a funk.

That is because over 70 percent of the transactions came entirely from a newly launched project, High Park Residences, located in the north-east of Singapore, which saw solid take up because of its relatively low price of S$989 ($702) per square foot and proximity to the city's new aerospace hub, according to analysts. The median price of the top 15 selling projects in July stood at $1,355 per square foot, according to Barclays.

Developer sales quadrupled from the previous month and more than tripled compared to a year earlier to a two-year high of 1,594 units last month, government data showed on Monday.

Less than 30 percent of transactions came from previously launched projects however, underscoring overall demand remains tepid, says Chua Yang Liang, head of research, South East Asia and Singapore at real estate services firm JLL.

"In my opinion, this stunning performance in July is an exception and it is not likely to cause a major shift in our forecast on the overall transaction volumes," he said.

"I hold on to my previously held view that new sales in 2015 should remain at between 6,500 to 7,500 units," he added. His forecast marks a further slowdown from 2014 when sales totaled 7,557 – dropping by half from 2013 and the lowest outturn since the 2008 financial crisis.

Tricia Song, an analyst at Barclays wasn't particularly encouraged by the latest data either, predicting that sales are likely to soften in August and September.

Developers are entering a traditionally quiet period for launches with the onset of the month-long Hungry Ghost festival, which is considered to be a highly inauspicious time to buy a property.

"The Ghost Month commenced on 14 Aug and will end on 12 Sep. We expect home buying to be subdued, exacerbated by the uncertainties in the stock market and regional currency volatility," said Song.

Singapore's stock market has fallen over 13 percent from this year's April peak, entering correction territory earlier this month amid soft corporate earnings and a spillover from China's recent stock market rout. The last time the country's benchmark Read MoreStraits Times Index (STI) entered a phase of correction was in June 2013 – more than two years ago, according to Phillip Futures.

Furthermore, the higher-end of the property market continues to remain under pressure, Song noted.

Luxury project Cluny Park Residences sold just two units at two units at S$2,548-2,606 per square foot in July, compared to the three units it sold in May at S$2,620. This price level is around 17% lower than its median launch price of S$3,121psf in August 2013 when it sold 12 units, according to data from Barclays.

Multi-speed market

Alan Cheong, head of real estate research at Savills, describes the current state of the market as "multi-speed".

"The high end of the market is still jammed, but the smaller units in the mass market are moving," he said.

"Cooling measures have enacted a huge hurdle, where larger apartments and landed properties that came with a high price quantum cannot clear the national affordability level," he said. "All this has done is re-channel domestic demand to smaller sized units," he said.

Despite their mixed impact of the market, analysts don't expect the measures to be rolled back anytime soon.

"Relaxation of measures unlikely in the near term," said Song, citing comments made by government officials in recent days.

Read MoreWhy the yuan may deck Singapore property stocks

Speaking at a national day event on August 14, Finance Minister Tharman Shanmugaratnam mentioned that the government is still taking a wait-and-see stance on the potential relaxation of property cooling measures.

Meantime, in an interview with a local newspaper, Minister of National Development Khaw Boon said that "measures have to be adjusted and perhaps even lifted, when it's the right time. The right time is when the equilibrium is a lot more certain, more sustainable. And I don't think we are at that point yet."

Since 2009, the government has imposed eight rounds of measures to prevent a bubble in the market, taking aim at foreign demand and speculators.

As of the second quarter, private home prices have fallen a cumulative 6.7 percent from their peak in the third quarter of 2013.