Comment by zeahfj

Not market forces, see reserve bank interventions. Deflation is not disastrous for economic productivity but it is a side effect of economic productivity. Taxes on earned income vs capital is a regressive tax system on the working class and a subsidy to the upper class. Owner-occupiers and first-time buyer subsidies are subsidies to the speculators. Increase in house prices happen the moment such policies are implemented to capture the entire benefit. The policies are only implemented after speculators have invested and drive up housing prices. This only benefits speculators (who can also be first-time buyers).