Direct property investors have been hit by the the goverment guarantee, however, they are divided over the question of whether the government guarantee has had a detrimental influence on their business.

Half of 100 direct commercial property investment managers surveyed by the Australian Direct Property Investment Association (ADPIA), which represents $60 billion in property investments, said the guarantee had led to either higher redemption rates for their funds or to lower inflow of money.

The other half did not believe the guarantee had directly impacted their business.

Still, the outcome of the survey was enough for the association to start lobbying for the removal of the guarantee.

"With 50 per cent believing that it is impacting, then it's time that all asset classes lobby the government to review their earlier hasty decision," ADPIA president Linden Toll said.

"There is no doubt that fund managers do not need any additional impairment to their businesses."

But Toll said industry members also had to make changes themselves if they were to attract inflows from retail investors again.

"Unfortunately, in an effort to win over retail investors, a relatively simple asset class became complex in some instances and introduced unrealistic levels of liquidity," he said.

"A return to the fundamentals of yield and some capital appreciation - without liquidity - is what investors will now demand."

However, Toll was cautiously optimistic on the outlook for the sector.

"We do think that we are starting to see some signs of recovery in our market," he said.