Nice location but obviously paid too much. A loss of almost 30%...

Nice location but obviously paid too much. A loss of almost 30% and at those sort of dollars is a very nasty and unfortunate way of teaching people that property does not always go up. 2 years ago in Perth was the peak of the market and probably the worst time to buy especially off the plan when they tend to incorporate increases in the price.
There will be more speculators around (assuming that they were) holding on to land and houses realising they may as well sell as the holding costs are too high, especially when the return is so low from rent and with no capital gains.
Imagine paying $2 million for a unit - the rent would need to be about $4,000 a week to cover costs.