Financial counsellors in Western Australia are in demand from a new client base — people who were earning high incomes during the mining boom and are now struggling to get work and pay their mortgages.

Lifeline financial counsellor Jenny Cecil says her cases are generally people who were on good incomes. ( ABC News: Andrew Willesee )

Unlike the Sydney and Melbourne property surge, house prices in Perth have plummeted, while unemployment and the cost of living have increased, catching out owners and investors.

"They've used their savings and tried to manage their money themselves," Lifeline financial counsellor Jenny Cecil told 7.30.

"They've been unemployed possibly eight to 12 months, so when they do come to see us it's sometimes difficult to offer options or arrangements to repay debt."

'Perth is on its knees'

Homes at the top end and on the urban fringe are the worst affected by falling prices.

Perth property valuer Gavin Hegney said the situation was the "reverse" of what was happening on the east coast, and lessons should be learned.

Perth property valuer Gavin Hegney says "there's probably a lesson for Sydney and Melbourne" in Perth's property slump. ( ABC News: Claire Moodie )

"Western Australia was infallible in 2006 and 2007, we were really booming," he said.

"We had a second kick along in 2012, and at that stage the Sydney and Melbourne markets were pretty well on their knees.

"Today Perth is on its knees.

"There's probably a lesson for Sydney and Melbourne today of perhaps what's coming after the market turns."

Mr Hegney warned against the Government making changes to negative gearing and capital gains tax.

He said he was concerned about changing "long-term policies in a short-term boom, which we are experiencing now on the eastern seaboard".

"You probably want to be planning policies now for when the market comes off, and it will come off. What policies then should we implement to soften the blow of the market?

"That's what we should be thinking today, not turning off the top of our boom."

Property prices 'almost halved'

Daniel Johnston, 35, bought an investment property in Mandurah, south of Perth, as a joint venture with relatives at the height of the boom in 2007 for $580,000.

But plans to develop the block fell through.

Daniel Johnston's investment property in Mandurah, south of Perth, has dropped in value from $580,000 to $350,000. ( ABC News: Claire Moodie )

The family now owes about $500,000 on a property that has dropped in value to $350,000, and Mr Johnston is concerned he will lose his family home.

"We've used part of the equity in our home for interest payments on this investment and certainly we're stretched," he said.

"We thought it might slow, the property price, but never expected the drop that Mandurah has had. It's nearly halved."

One of the key drivers of the market is an oversupply of housing partly caused by the huge population shift over the last four years, according to Bankwest chief economist Alan Langford.

"The year to 2012, 56,000 people came to WA from other countries and 14,000 from the rest of Australia," he said.

"But in 2015-16, only 14,000 people came to WA from other countries and we actually lost almost 10,000 people to other parts of Australia.

"We're actually seeing new dwelling construction falling away so that oversupply will gradually be absorbed."

Mr Langford said WA was also experiencing a record rate of "underemployment" which was exacerbating the squeeze on households.

"That's at a historical high, almost 10 per cent, more than a full percentage point above the national rate," Mr Langford told 7.30.

"Of course, underemployment means the household isn't getting quite the income growth to when they were fully employed during the boom.

"So, yes there is definitely an income problem with affordability in WA at the moment."

Incomes slashed to a fraction of what they were

Project engineer Brad Wright is another casualty of the downturn.

The 57-year-old has been unable to find a job in his profession for two years and now works as a part-time security guard to make ends meet.

Project engineer Brad Wright is struggling to hold onto his family home. ( ABC News: Claire Moodie )

He is embroiled in a complex dispute with his bank that stems from two interstate investment properties in 2007 which have subsequently been sold at a loss.

Mr Wright said acquiring the low-doc loans for the properties was "as easy as buying an ice-cream".

"It was that simple. We were quite shocked. We needed close to a million dollars and that was pretty much approved within 24 hours."

Now, he is struggling to hold onto the family home in one of Perth's inner suburbs.

"We've been left with up to $90,000 of bills and we have no money to service all of our other creditors," he said.

"The stress of me trying to deal with the bank and get some kind of reasonable solution from them has almost pushed me to the point of suicide.

"I'm not bullshitting, it's been really tough.

"I really don't know what we'll do if this house is sold because we will be basically kicked out on the street with just the clothes we are wearing and substantial debts."

Mr Wright said many of his former colleagues were in serious financial strife.

"People have had their incomes slashed to 10 - 20 per cent of what they were normally being paid and they're having to meet enormous payments," he said.