ASB Bank has predicted a fall of 25 percent in the housing market, but it could go to to 40 percent when adjusted for inflation.

This is in contrast to ANZ's prediction of a 32 percent market drop. House prices are already dropping by 11 percent, according to new data.

HSBC Chief Economist Paul Bloxham says that these forecasts are accurate and that broader inflation is a key indicator in house prices.

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