Queensland's property market has softened since January 2008. This has resulted from:
- A long run of prosperity between 2001-07, which saw almost all property in Queensland increase in value by more than 100%
- The virtual satisfaction of pent-up demand for property
- Mortgage interest rates rose from 5.5% per annum to 9.5% per annum since the year 2000.
I state in my latest Midwood Queensland Investment Report (May quarter 2008) that there is no need to raise interest rates any further. Doing so would only stop the market completely and cause damage to borrowers, lenders, asset values and all of the ancillary industries which depend upon the housing industry.