High-end homes poised for a comeback as prices crash to record lows

Prices have moderated by as much as 20%.

The luxury residential segment could finally be poised for a comeback after being plagued by price falls for several consecutive quarters, a report by Knight Frank revealed.

According to a report by Knight Frank, developers are now more than willing to reduce prices as the 7-year grace period under the Qualifying Certificate rules nears expiry.

"The lower property prices have now presented greater value for high-end residential properties, which offers reasonably stable rental income in the short term as high-income tenants keep their preference for prime residential properties," wrote Alice Tan, Director and Head of Consultancy and Research.

Tan believes that conducive fundamentals support appeal for luxury homes, as Singapore still holds considerable appeal as a favoured market in Asia for real estate investment.

"Investors could return to the high-end homes market as early as the second half of 2015, a period where overall private home prices could have declined by about 5% to 6% to 'acceptable levels' and any potential adjustments to property cooling measures could be on the cards in a bid to restore demand for Singapore residential property,” Tan noted.