Time will tell with coronavirus

To date, she noted that housing has performed “relatively” well against negative economic shocks, “but the unique conditions of a pandemic-induced economic slowdown must be considered”.

Ms Owen considered that existing economic headwinds at play – including high household debt – do make the property market particularly susceptible to a fall in demand.

In the short term, the coronavirus and subsequent sharemarket declines have already had a significant impact on consumer confidence, which the researcher said could lead to postponed dwelling purchases.

A more direct impact on transactions could arise out of increased isolation precautions being taken across Australia.

In the long term, Ms Owen considers housing market values and activity will be linked “to the extent that quarantine measures affect income, employment, borrowing capacity and credit availability”.

Important, too, is the fact that CoreLogic does not consider Australia to have “one” housing market.

“Given the idiosyncrasies of the current downturn, there are likely to be parts of Australia where housing demand – including rental demand – will fall more sharply than others,” Ms Owen flagged.

“These include areas where workers cannot perform their jobs remotely and may have to sacrifice income if social distancing is enforced, where there is a high incidence of casual employment, and where there is a high concentration of employment in affected industries,” she continued.

While the coronavirus outbreak “clearly” presents some downside risk for the Australian housing market, Ms Owen said ultimately, the impact remains highly uncertain.

“New information and policy responses are unfolding daily, making it impossible to provide a reasonable forecast of capital growth.”

Despite this, she reminded investors to remember the fundamentals of the property market, as well as the fact that property is less volatile and slower to respond to market shocks than other aspects of the economy.