Sorry everyone, I was mistaken. There's actually no house-price bubble:
"Buyers have been told that Melbourne is not suffering from a house-price bubble. Property valuer Greville Pabst, of WBP Residential Advice, said that although property prices were higher than 10 years ago, these prices had become the new norm."
Greville doesn't actually provide any reasons why high prices are here to stay, but he's in the real-estate industry so he must know.
Sorry about that. I will shut down this blog straight away.