The sell-off on the JSE more than a week ago saw the SAPY property index lose 3,6 percent, compared to the drop on the All Share Index of 3,7 percent, and losses in the All Bond Index of 0,6 percent, bringing the property index back to its levels in mid-March.

Robins said the decline in property stocks was probably overdone, based on the weakness in bonds on the day, but could have been a result of the sector playing catch-up after recent bond market softness.

"The fall in property stocks illustrated that listed property can at times behave like equities rather than bonds," Robins said.

"If property behaves like equities, investors may demand a larger risk premium. If the sell-off continues there is a risk that the large retail investor base and geared investors could take fright and sell. This would be detrimental. We recommend investors to sit tight in the market."

"According to our model, property was slightly expensive prior to last week's sell-off. This selling may have been the catalyst to flush out weak holders.

"Some investors may prefer to wait for confirmation that the selling pressure has abated before buying," Robins cautions. "And investors shouldn't buy listed property simply on the basis of possible capital gains. However, for those with a long-term view we suggest those underweight property use further weakness to pick up stock, as the distribution growth fundamentals for listed property companies remain very favourable."