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Demand is unlikely to increase, imo. Interest rates will keep it down. Even if the reserve bank sits on its hands, banks will increase them independently. And economics 101 states that if people can afford less money, they spend less money. Assuming anyone's desperate to sell, they'll need to sell what people can afford and are willing to pay.
As it is, I think it's already cheaper to buy properties in the Eastern States than it is in Perth; and this would be what, the first time in history? The market has further to slide, quite comfortably.
On the flip side, the further it slides, the fewer people will actually sell. While demand increases prices, falling prices influence supply almost equally so; so if everyone who owns property in Perth can afford to be a tight arse and nobody loses their house to interest rates, prices could remain fairly steady until inflation catches up.
That'll mean a lot of real estate companies are out on the street though, because there's no house sales for them to get a commission on.
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