Most people are followers and put less than a few minutes of thought into voting.
I think the Libs had a massive advantage here, as someone already pointed out just look at the negative campaign they dug up for Latham, he didn't have a chance.
I think he did quite well considering all that he faced. Look at the strong performance of the first time church funded party, Family First, directing the vast majority of it's votes toward the Libs enabled the government to retain several seats it would have lost without their support. The liberal party can't form government on it's own either, the nationals still retain strong support and this is an area where the labor party is still building it's base.
I honestly thought Howard told one too many lies, was truly exposed as the lying rat he is etc.. but I guess people care more about their mortgages even if they don't realise they didn't have to worry in the first place.
The ALP really need a strong moderate coalition (not just greens) of some kind to form a government, just as the Libs do.