With affordability stretched and the economy slowing, housing market activity is expected to remain weak over the coming quarters. While we expect house prices to lose some of their recent momentum, the worst of the correction appears to have passed and we don’t expect further sustained declines. Nonetheless, any recovery in activity and prices will be sluggish even as economic conditions improve next year. Rental growth appears to be slowing against a background of softer demand and strong supply. Further declines in multifamily capital values are forecast this year, bringing the peak-to-trough fall to over 20%.
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