UBS Global Real Estate Bubble Index 2025: Top 3 Bubble Risks are Miami, Tokyo & Zurich, Top 5 Price Increase in Last 12 Months Madrid +13.6%, Dubai +11.1%, Tokyo +5.7%, Zurich +5%, Geneva +4.1%, Top 5 Price Decrease in Last 12 Months Hong Kong -7.9%, Toronto -7.5%, Vancouver -5.9%, Milan -2.7%, San Francisco -2.6%, Most Work years Required to Buy 60 sqm (650 sq ft) Flat Near City Centre is Hong Kong in 14 Years, Most Rental Years Required to Fully Pay for Flat is Zurich in 43 Years
16th October | Hong Kong
UBS has released the UBS Global Real Estate Bubble Index 2025, providing key insights into real estate bubble risk & price level in 21 cities globally. Top 3 Bubble Risks – Miami, Tokyo, Zurich. Elevated Bubble Risks – Los Angeles, Dubai, Amsterdam, Geneva. Moderate Bubble Risks – Toronto, Sydney, Madrid, Frankfurt, Vancouver, Munich, Singapore. Low Bubble Risks – Hong Kong, London, San Francisco, New York, Paris, Milan, Sao Paulo. Top 5 Real house price growth in last 12 months – Madrid +13.6%, Dubai +11.1%, Tokyo +5.7%, Zurich +5%, Geneva +4.1%. Top 5 Real house price decrease in last 12 months – Hong Kong -7.9%, Toronto -7.5%, Vancouver -5.9%, Milan -2.7%, San Francisco -2.6%. Top 5 Most no. of work years required for skilled service worker to buy a 60 sqm (650 sq ft) flat near city centre – Hong Kong 14 years, Paris 12.5 years, London 12 years, Tokyo 11 years, Singapore 10.5 years. Top 5 most no. of rental years required for skilled service worker to fully pay for flat – Zurich 43 years, Munich 39 years, Geneva 38.5 years, Frankfurt 33 years, Tokyo 32.5 years. See below for key findings & summary | View report here
“ UBS Global Real Estate Bubble Index 2025: Top 3 Bubble Risks are Miami, Tokyo & Zurich, Top 5 Price Increase in Last 12 Months Madrid +13.6%, Dubai +11.1%, Tokyo +5.7%, Zurich +5%, Geneva +4.1%, Top 5 Price Decrease in Last 12 Months Hong Kong -7.9%, Toronto -7.5%, Vancouver -5.9%, Milan -2.7%, San Francisco -2.6%, Most Work years Required to Buy 60 sqm (650 sq ft) Flat Near City Centre is Hong Kong in 14 Years, Most Rental Years Required to Fully Pay for Flat is Zurich in 43 Years “
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UBS Global Real Estate Bubble Index 2025: Top 3 Bubble Risks are Miami, Tokyo & Zurich, Top 5 Price Increase in Last 12 Months Madrid +13.6%, Dubai +11.1%, Tokyo +5.7%, Zurich +5%, Geneva +4.1%, Top 5 Price Decrease in Last 12 Months Hong Kong -7.9%, Toronto -7.5%, Vancouver -5.9%, Milan -2.7%, San Francisco -2.6%, Most Work years Required to Buy 60 sqm (650 sq ft) Flat Near City Centre is Hong Kong in 14 Years, Most Rental Years Required to Fully Pay for Flat is Zurich in 43 Years
UBS has released the UBS Global Real Estate Bubble Index 2025, providing key insights into real estate bubble risk & price level in 21 cities globally. See below for key findings & summary | View report here
UBS Global Real Estate Bubble Index 2025
Summary
- Top 3 Bubble Risks – Miami, Tokyo, Zurich
- Elevated Bubble Risks – Los Angeles, Dubai, Amsterdam, Geneva
- Moderate Bubble Risks – Toronto, Sydney, Madrid, Frankfurt, Vancouver, Munich, Singapore
- Low Bubble Risks – Hong Kong, London, San Francisco, New York, Paris, Milan, Sao Paulo
- Top 5 Real house price growth in last 12 months – Madrid +13.6%, Dubai +11.1%, Tokyo +5.7%, Zurich +5%, Geneva +4.1%
- Top 5 Real house price decrease in last 12 months – Hong Kong -7.9%, Toronto -7.5%, Vancouver -5.9%, Milan -2.7%, San Francisco -2.6%
- Top 5 Most no. of work years required for skilled service worker to buy a 60 sqm (650 sq ft) flat near city centre – Hong Kong 14 years, Paris 12.5 years, London 12 years, Tokyo 11 years, Singapore 10.5 years
- Top 5 most no. of rental years required for skilled service worker to fully pay for flat – Zurich 43 years, Munich 39 years, Geneva 38.5 years, Frankfurt 33 years, Tokyo 32.5 years
UBS Global Real Estate Bubble Index 2025
1) Real Estate Bubble Index
- Miami – 1.73
- Tokyo – 1.59
- Zurich – 1.55
- Los Angeles – 1.11
- Dubai – 1.09
- Amsterdam – 1.06
- Geneva – 1.05
- Toronto – 0.80
- Sydney – 0.80
- Madrid – 0.77
- Frankfurt – 0.76
- Vancouver – 0.76
- Munich – 0.64
- Singapore – 0.55
- Hong Kong – 0.44
- London – 0.34
- San Francisco – 0.28
- New York – 0.26
- Paris – 0.25
- Milan – 0.01
- Sao Paulo – -0.10
Bubble:
- Miami – 1.73
- Tokyo – 1.59
- Zurich – 1.55
Elevated:
- Los Angeles – 1.11
- Dubai – 1.09
- Amsterdam – 1.06
- Geneva – 1.05
Moderate:
- Toronto – 0.80
- Sydney – 0.80
- Madrid – 0.77
- Frankfurt – 0.76
- Vancouver – 0.76
- Munich – 0.64
- Singapore – 0.55
Low:
- Hong Kong – 0.44
- London – 0.34
- San Francisco – 0.28
- New York – 0.26
- Paris – 0.25
- Milan – 0.01
- Sao Paulo – -0.10
Price bubbles are a recurring phenomenon in property markets. The term “bubble” refers to a substantial and sustained mispricing of an asset, the existence of which cannot be proved unless it bursts. But historical data reveals patterns of property market excesses. Typical signs include a decoupling of prices from local incomes and rents, and imbalances in the real economy, such as excessive lending and construction activity. The UBS Global Real Estate Bubble Index gauges the risk of a property bubble on the basis of such patterns. The index does not predict whether and when a correction will set in. A change in macroeconomic momentum, a shift in investor sentiment, or a major supply increase could trigger a decline in house prices.
2) Key Observations
Shifting risks – Miami shows the highest bubble risk among the cities in this study. High bubble risk also appears in Tokyo and Zurich. An elevated risk is evident in Los Angeles, Dubai, Amsterdam, and Geneva. Over the last four quarters, global housing markets continued to cool on average. Price-to-rent ratios declined across European and Asian cities, excluding Tokyo. Subdued mortgage lending reflects still-elevated financing costs in most regions. Even though mortgage rates have eased since 2023, they remain roughly twice the level seen from 2020 to 2022. New residential construction has trended lower, worsening housing shortages in growing urban areas. Overall, broad exuberance has faded, with average bubble risk in major cities falling for a third straight year.
Urban centres vs Suburbs – From 2010 to 2020, home prices in all selected urban centers rose faster than in their respective markets. But over the last five years, the trend reversed: Most city housing markets underperformed their national averages. Two forces have been at work: First, demand shifted to the suburbs following the pandemic and the rise of flexible work. Second, higher interest rates squeezed affordability in many cities, pushing more buyers toward cheaper suburbs and satellites. That pattern could reverse again as many countries, including much of Europe, face aging and soon shrinking populations. As rural areas lose residents and economic activity, urban centers may attract more growth, with Tokyo a leading example
Foreign investors – Overseas demand has also amplified housing booms, boosting urban outperformance. In recent years, Tokyo, Madrid, Miami, and Dubai drew strong foreign investor interest. By contrast, tougher rules—from new taxes to outright purchase bans—have dimmed the appeal of once sought-after markets such as Vancouver, Sydney, Paris, Singapore, and London.
Outlook hinges on inflation – From a macroeconomic perspective, the outlook for housing as an investment appears solid. Central banks are expected to lower policy rates by 2026, gradually reducing real financing costs. In an over-indebted world facing inflation and looming financial repression, housing can serve as a financial shelter. In most urban centers, limited supply also supports further price gains. However, this scenario depends on inflation staying contained and growth remaining resilient across major economies—both of which remain uncertain.
3) City Spotlight – New York, London, Sydney, Singapore, Hong Kong, Dubai & Hong Kong
New York – Return-to-office normalization and steady job growth, especially in higher-income segments, have been pull- ing more renters into the city, increasing competition for limited listings. Rental growth accelerated in the last four quarters amidst low vacancy rates. However, prices for condominiums did not benefit from rising demand and stagnated in inflation-adjusted terms. High-end properties, on the other hand, were in high demand following strong equity market gains.
London – London home prices are lagging inflation. Real values slipped 2% in the past year and are roughly 20% below their 2016 peak, when the UBS Global Real Estate Bubble Index signalled high bubble risk. The risk score has since eased to low, retreating further over the last four quarters. Despite lower prices, affordability has not improved meaningfully and remains poor. Housing starts remain at record lows, pressured by strict planning rules, elevated borrowing costs, and subdued demand. As projects stall, the housing shortage shows little sign of easing, keeping upward pressure on rents, which are still rising—though at a slower pace than in previous years. Without a clear catalyst to unlock supply, affordability is likely to remain strained. Overseas demand for London property is recovering, with a weak pound and the city’s global status continuing to draw foreign capital. Even so, prime buyers remain cautious, as surcharges and less favourable tax treatment for nonresidents continue to weigh on demand. Bank of Eng- land rate cuts have yet to jump-start the broader housing market, and the high likelihood of rising property taxes is dampening interest. Still, additional rate cuts amid weak economic growth, combined with looser mortgage-lend- ing rules, could lift buyer appetite.
Sydney – Home prices have largely tracked elevated inflation since 2022. Recent rate cuts have revived buyer confidence, lifting demand in premium suburbs. However, borrowing costs remain high, keeping ownership out of reach for most: the user cost of a 60 sqm (650 sqft) apartment near the city center now exceeds 60% of household income. Strong in-migration in recent years has kept the rental market tight. A new planning law to boost lower-cost construction and a temporary ban on foreign purchases may offer only limited relief.
Singapore – Real home prices have risen about 3% a year since 2021, while rents have climbed roughly twice as fast. Fundamentals are solid: The population grew about 10% over the period, and vacancies fell amid construction delays. Authorities curbed speculative buying and foreign demand through additional buyer stamp duties, keeping bubble risk moderate to low. Transaction volumes should pick up as mortgage rates decline and new supply comes online, but price gains should stay modest and track economic fundamentals over the long term.
Hong Kong – Sales activity has picked up, supported by changes to mort- gage insurance, property stamp duty easing, lower rates and most importantly lower home prices. Real home prices started to stabilize after falling nearly 28% below 2021 levels matching those last seen in 2011 in inflation-adjusted terms. While financing costs are expected to ease further following the trend of US rates, prices are likely to be flat to slightly negative as high inventories weigh on the outlook. The lower prices have improved the relative affordability compared to the last peak.
Dubai – After rising 11% over the last four quarters, inflation-adjusted home prices in Dubai have returned to their 2014 peak. Housing bubble risk has surged for a second consecutive year and is now at elevated levels, up from last year‘s moderate read- ing, according to the UBS Global Real Estate Bubble Index. Dubai’s population has grown by nearly 15% since 2020, tightening available supply and pushing rents higher. Over the past five years, rent increases surpassed home price gains. More recently, however, home prices have started to outpace rent growth as investment demand strengthens. That said, rental yields remain high, and prices are still comparatively affordable often well below those in other major global cities. Hence, optimistic investors see catch-up potential and prospects for strong future returns. How- ever, pricing power is weak in some segments. Incomes are not keeping pace with home prices, and affordability has deteriorated as interest rates remain elevated. The market remains volatile, with exposure to oil prices and periodic oversupply. Building permits suggest new construction could reach levels last seen in 2017, which amplified the housing downturn. Competition for offshore real estate investment with Abu Dhabi and Riyadh is intensifying, especially as Saudi Arabia opens designated zones to foreign buyers starting in 2026. While Dubai’s government expects a continued rapid economic expansion, it is uncertain whether household incomes will rise enough to support further price increases.
4) Real house price growth in last 12 months
- Madrid: +13.6%
- Dubai: +11.1%
- Tokyo: +5.7%
- Zurich: +5%
- Geneva: +4.1%
- Singapore: +2.6%
- Miami: +1.9%
- Munich: +1.4%
- Amsterdam: +1.2%
- Los Angeles: +0.9%
- Paris: +0.1%
- Sao Paulo: 0%
- Sydney: -0.8%
- Frankfurt: -1.2%
- New York: -1.5%
- London: -2.1%
- San Francisco: -2.6%
- Milan: -2.7%
- Vancouver: -5.9%
- Toronto: -7.5%
- Hong Kong: -7.9%
5) No. of work years required for skilled service worker to buy a 60 sqm (650 sq ft) flat near city centre
- Hong Kong – 14 years
- Paris – 12.5 years
- London – 12 years
- Tokyo – 11 years
- Singapore – 10.5 years
- Zurich – 8.5 years
- Sao Paulo – 8.25 years
- Munich – 8.25 years
- Geneva – 8 years
- Sydney – 8 years
- Dubai – 7.75 years
- Amsterdam – 7.75 years
- New York – 7.5 years
- Milan – 7 years
- Vancouver – 6.5 years
- Madrid – 6 years
- Frankfurt – 6 years
- Los Angeles – 5.75 years
- Toronto – 5.5 years
- San Francisco – 5.25 years
- Miami – 5 years
5) No. of rental years required for skilled service worker to fully pay for flat
- Zurich – 43 years
- Munich – 39 years
- Geneva – 38.5 years
- Frankfurt – 33 years
- Tokyo – 32.5 years
- Hong Kong – 30 years
- London – 28 years
- Singapore – 28 years
- Vancouver – 27.5 years
- Paris – 27 years
- Milan – 27 years
- Sydney – 26 years
- Amsterdam – 24 years
- Toronto – 23 years
- Madrid – 22.5 years
- San Francisco – 21.5 years
- Los Angeles – 19.5 years
- New York – 19 years
- Sao Paulo – 16.5 years
- Miami – 15.5 years
- Dubai – 15 years
UBS Global Real Estate Bubble Index 2025
Methodology – The UBS Global Real Estate Bubble Index traces the fundamental valuation of owner-occupied housing markets and the valuation of cities in relation to their country and economic distortions (such as lending and building booms).
UBS – UBS is a leading and truly global wealth manager and the leading universal bank in Switzerland. It also provides diversified asset management solutions and focused investment banking capabilities. UBS manages 6.6 trillion dollars of invested assets as per second quarter 2025. UBS helps clients achieve their financial goals through personalized advice, solutions and products. Headquartered in Zurich, Switzerland, the firm is operating in more than 50 markets around the globe. UBS Group shares are listed on the SIX Swiss Exchange and the New York Stock Exchange (NYSE).
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