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Housing market faces serious downsides

The housing market will take a deep hit from the coronavirus. We expect housing transactions and housebuilding to drop by 70% in Q2 this year, as physical distancing measures halt activity. Meanwhile, house prices will see the biggest fall since the global financial crisis. Admittedly, our base case is for activity and prices to recover fairly quickly. But a credit crunch or larger economic hit could trigger an even deeper downturn.

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