Global Property Crash Stress Test Scenario

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Stress tests are an effective tool for understanding cause and effect relationships and risk exposure across a spectrum of extreme shocks, such as those proposed in the Cambridge Taxonomy of Threats, encompassing five classes of business risk. This report is one from a suite of scenario reports that can be used by businesses as a basis for testing against vulnerabilities and improving resilience.

The Global Property Crash Stress Test scenario report describes a property bubble that is triggered in the emerging boom markets of South East Asia and propagates across continents as investors and banks lose faith in global property markets. Following the housing market collapse in India and China the contagion spreads and affects both mortgage and non-mortgage asset prices in Asia Pacific, Scandinavia, Europe and beyond.