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There’s a dire warning that house prices could plunge by up to a third next year, if interest rates keep rising and unemployment soars. That’s the worst case scenario forecast by Citi Bank economists.

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They predict house prices will most likely fall 23 per cent. And in more positive scenarios, suffer a 15 per cent drop. It comes as the number of distressed property listings nationwide jumps. They’re up 15 per cent since May, with desperate homeowners forced to sell. New South Wales and Queensland saw the biggest rises.

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