While the COVID-19 pandemic has significantly affected market activity and listing volumes, property values remained in positive territory over the past couple of weeks, according to CoreLogic's latest market analysis.

Property prices in the 28 days ending on 21 April clocked a growth rate of 0.4% – surprising given the current economic picture but still considerably lower than the 1.1% growth rate recorded in mid-March, before social distancing measures were implemented across the country.

Eliza Owen, head of residential research at CoreLogic, said that it is still likely that property values will fall amid the downturn.

"It seems hard to digest that property values have not plummeted. In an address given on the 21st of April, Reserve Bank Governor Phillip Lowe outlined that we are facing the worst economic contraction since the 1930s," she said.

Also read: Buyer Activity Still Strong In Some Markets

In the speech, Lowe suggested that by June, the national economic output could fall by 10% while the unemployment rate could hit 10%. Total hours worked are also expected to decline by 20%.

Owen said this could give rise to a larger volume of distressed sales as homeowners struggle to service their mortgages.

"And yet, there is so far no evidence of that," she said.

During the 28-day period, new listing volumes were actually 28.7% lower than they were last year. The total listing stock was also down by 23.8%.

Owen said this have led to a constrained housing supply, which could be one of the factors preserving the relative stability of house prices.

Vendor expectations are also helping stabilise property values. Given that the "temporary" nature of the enforced downturn, Owen said sellers might be holding onto a relatively high expectation of their property value, with a plan to sell once the economy returns to full-scale production.

Furthermore, the banks' deferral offers could also be helping cushion the impact of the COVID-19 outbreak on property prices. This option has helped minimise the number of people who are struggling to service their mortgages.

"A true test for property values may come once these 'holiday periods' end. Financial regulators, the RBA and the banking sector may extend reprieve for mortgage repayments in the scenario that the economy has not made improvements within six months," she said.