While we expect mortgage rates will fall to 5.75% by end-2023, affordability will remain stretched. Alongside a weakening economy and falling house prices that will weigh on housing market activity. Indeed, we think 2023 will be the worst year for sales since 2011 and starts since 2014. Meanwhile, we expect house prices to drop around 6% this year, resulting in a peak-to-trough fall of 8%-10%.
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