What does rising unemployment do to house prices?

A couple of charts from Westpac gives us some idea:

Notice how VIC and NSW have kept a long term relationship between the cost of debt and arrears rates. But in QLD and WA that has broken down with Perth absolutely collapsing.

The key, I suggest, is unemployment. WA has seen the largest move up in the jobless rate as its property market came apart, while other states have improved:

There will be many other factors here. WA has seen a comprehensive boom and bust with mass deflation in all corners.

But it is a standing warning for the RBA that if it waits for unemployment to rise before easing then it is also be waiting for house prices to fall much further as the internal dynamics of tightening credit seize banks with rising loan losses.