HOUSING AFFORDABILITY INQUIRY

The Reserve Bank of Australia’s submission to the Inquiry [#52] doesn’t mention that a zero interest rate policy implies infinite land prices.

Maybe the RBA doesn’t want to offend (1) real estate agents whose fee scales have them committed to higher and higher land prices, and (2) the banking industry whose easy credit/debt policy pumps up land prices and its super-profits?

It’s more than obvious that Joe and Joan Sixpack don’t feature at all in RBA considerations.

But then, as Poirot mentioned, it’s land prices and taxation generate inflation, not simply “excess money” or “excess demand”, and the RBA are not likely to advise governments (of any persuasion) about that truism, either.