Agreed, prices HAD indeed been driven by easy credit upto 2007,...

Agreed, prices HAD indeed been driven by easy credit upto 2007, but then the banks got squeezed and passed that onto the consumer in 2008, hence there are some forced sellers now and a resulting glut.

However, today:
1) Banks are lending pretty reasonable amounts...up to 95% with mortgage insurance for properties under $1 mill....to those they deem a good risk.
and
2) There is alot of money sitting on the side right now ....RBA data shows interest costs as a percentage of income has dropped 20% in the last 15 months...
In conclusion, the buyers are being canny right now, sitting off the bid and waiting for the sellers to come to them. There will be a point of inflection where the buyers step up and the forced sellers finally sell. the only problem right now is that the spread between the buyer and seller is still too wide to get business done, hence the low sales data.