According to that RBA chart private demand for credit peaked during 1988 when the standard variable home loan interest rate was about 15%. So extremely high rates did not deter borrowers.
Today with mortgage rates less than half that of 1988, credit growth is also less than half. So extremely low rates are not encouraging borrowers to take on debt. So much for the price of money dictating credit demand and therefore house prices.
The housing bubble of the late 80s was driven by a credit fueled asset mania, just as it was over recent years (and during every asset bubble in history throughout the world). The tipping point only occurs when the greatest fool has finally entered the market, not by central bankers. It's all about the mood of the herd. And the herd is growing restless again.
