Victoria, the state with the highest stamp duty and an economy tied more to population growth and housing than others, is likely to report a fall in property revenue at its state budget on Tuesday, showing its dependence on the volatile real estate market, economist Saul Eslake says.

Treasurer Tim Pallas, who last week said the second-largest state was in for a “challenging” budget, will hand down a fiscal statement that will reflect the residential and commercial property downturns harder than other states, according to Mr Eslake.