It has to be A
While depressed property values can hurt some large investors,they are potentially devastating for homeowners, whose equity —in many cases representing a life's savings—can plunge or even disappear.
(A) they are potentially devastating for homeowners, whose
(B)they can potentially devastate homeowners in thattheir - According to MGMAT:Repeated pronouns are presumed to have the same antecedent. In this case, the antecedent for "their" ishomeowners ,
...
While depressed property values can hurt some large investors,they are potentially devastating for homeowners, whose equity —in many cases representing a life's savings—can plunge or even disappear.
(A) they are potentially devastating for homeowners, whose
(B)they can potentially devastate homeowners in thattheir - According to MGMAT:Repeated pronouns are presumed to have the same antecedent. In this case, the antecedent for "their" ishomeowners ,
...
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