Asia's hottest real estate markets - China, Hong Kong and Singapore - have recently seen a slew of cooling measures by their governments to suppress demand and curb soaring prices.
While these measures may remove speculators from the markets in the short term, analysts tell CNBC there's not much that governments can do to control prices, without running the risk of destabilizing economies.
"The reality is the [property] market is stronger than any government and unless we start to see some pretty draconian measures, the market will always find a way around these government policies," David Green-Morgan, global capital markets research director, Jones Lang LaSalle said.
Last week, China imposed its toughest measures in the past year to curb speculative demand, with plans to strictly enforce an existing 20 percent capital gains tax, boost the down payment required and raise mortgage rates on second homes.
Similar measures were taken on by Hong Kong and Singapore. In February, the Hong Kong government pledged to boost land supply, hiked stamp duties and placed curbs on home loans, adding to a series of cooling measures since October 2009. In Singapore, curbs including a seller's stamp duty and increased taxes for foreigners and corporates were introduced in January, rounding out the nation's seventh round of cooling measures in the last four years.
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While the curbs do temporarily affect transaction volumes, according to Wee Liat Lee, managing director, head of property research, BNP Paribas Securities Asia, demand usually returns in Hong and Singapore six to eight weeks after the measures and then the tightening cycle continues.
"When volumes start to come back and start to accelerate, the government will have to tighten further," Lee said. "It will be slow volume, then the return of volume and then more tightening."
Despite the continuous measures by the governments, prices remain stubbornly high. Prices for private homes in Singapore have risen almost 60 percent since mid-2009. In Hong Kong, home prices have jumped 120 percent since 2008, while prices in China's 100 biggest cities rose for the ninth straight month in February.
In China, reports emerged earlier this week of couples flocking to divorce to get around the measures, evidence that the measures still had loopholes and speculators will go to the extremes to avoid them.
Still, analysts don't expect drastic measures from the government, for fear of destabilizing markets. Hong Kong's last property crash, when prices fell 50 percent in 1997 during the Asian financial crisis, was triggered after former Chief Executive Tung Chee-hwa announced plans to add as many as 85,000 housing units to cool prices. That extended a prolonged slump in the markets that lasted six years.
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This is the type of scenario governments will want to avoid. "The danger is that they introduce measures, which have an over-toppling effect and they really do hurt the market quite severely," said Jones Lang LaSalle's Green-Morgan.
According to Nicole Wong, regional head of property research at CLSA, governments don't want to be in the driver's seat in controlling prices. "People can't expect governments to be able to drive prices. What the government is doing is just to slowdown that price inflation," she said.
Two Possible Triggers
So what would undo the uptrend in prices? Analysts said it will come down to a macro development like an economic downturn or rising interest rates, both of which are unlikely in the near term. Asia's economies remain buoyant for now, and central bankers will avoid hiking rates so long as U.S. Federal Reserve Chief Ben Bernanke maintains an easy monetary policy.
"The reason why the prices aren't coming down is because the cost of holding on to properties is way too low, so if you want the property price to come down, there must be sellers in the market," Lee said. "The sellers will come back when the cost of holding the property increases - when they're paying a higher mortgage rate."
The environment of easy monetary policy will continue to bring money flows into Asia, and inadvertently, the property markets. Analysts say this will mean more cooling measures for all three markets, because price pressures persist.
"The governments have made it very clear that if prices go up, you need to counteract the sharper increases in prices, so they have to tighten further," Lee said.
—By CNBC.com's Rajeshni Naidu-Ghelani; Follow her on Twitter