Property ‘less volatile’ than equities

That being said, Ms Owen noted that in comparison to equities, “property is less volatile and slower to respond to market shocks”.

“It is a consumption good and it is tied to fundamentals of employment opportunity and income growth,” Ms Owen said.

“In the current climate, the Australian housing market is more insulated from foreign demand and investment speculation than it has been over previous years.

“Transaction activity is likely to be impacted more than market values.”

Furthermore, as consumer confidence reduces, and labour markets are disrupted, Ms Owen believes more Australians are likely to put high-commitment decisions on hold “until there is more certainty around the economy, jobs and household finances”.

“Additionally, stimulus measures, including emergency-level monetary policy settings and a surge in fiscal spending, should help to cushion the impact of reduced business activity, but a recession in the first half of 2020 still looks likely,” she said.

“The current high level of household debt amplifies the risk of unemployment on housing market conditions. However, areas severely impacted by social distancing would be less resilient than others in rebounding from the coronavirus pandemic.

“Our views and research on the market outcomes in relation to the coronavirus will continue to evolve as more information comes to light.”