SINGAPORE (March 27): There is room to ease some property cooling measures in Singapore this year now that home prices, property speculation and interest from foreigners have come off and interest rates are starting to rise, says Maybank Kim Eng.

"Four key metrics for the government – home prices, speculation, interest rates and foreign buying – have started to move in its desired directions. This should provide leeway for a review of its measures," Maybank Kim Eng analyst Derrick Heng wrote in a note.

The high-end property market could be the starting point for policy changes, he said.

"High-end home prices have already corrected for seven consecutive quarters. Prices today are not far from levels during the global financial crisis. As such, we believe property-cooling measures for this segment may be eased first."

Specifically, the additional buyer's stamp duty (ABSD) for foreigners could be lowered, he said.

The ABSD for Singapore citizens and permanent residents buying a second property can also be reduced to help "soak up" the large number of unsold mass-market homes built in recent years, he said.

"With total debt servicing ratio measures and loan-to-value requirements still in place, investment demand should be kept in check. This should allow the government to engineer a soft landing in the mass market."

Singapore has about 23,600 unsold private residential units, representing 7.6% of the total number of private homes, according to the Urban Redevelopment Authority.

Included in this figure are more than 11,000 mass-market units.

"Our demand-supply model suggests that the current oversupply will persist till 2018," said Heng.