Global property bubble watch: Miami, Tokyo and Zurich flagged as highest-risk cities
A UBS report tracking housing bubble risks across 21 major cities ranks Miami as the most at risk, followed by Tokyo and Zurich, as prices outpace incomes and rents in key markets.
Property markets in major global cities are facing rising bubble risks as housing prices climb faster than incomes and rents can support, according to the latest UBS report ranking real estate bubble risk across 21 leading cities—a snapshot investors and executives are watching closely.
Miami ranked first for bubble risk, with a risk score of 1.7. While price growth has begun to slow, UBS noted that the price-to-rent ratio has already risen above levels seen during the 2006 housing bubble, signalling that property values remain well ahead of fundamentals.
Tokyo placed second and Zurich third, both with risk scores of 1.6. UBS said Tokyo continues to face pressure from steadily rising home prices, while income and rent growth have been modest. Zurich, meanwhile, stands out for how tight its market has become: property values have risen around five times faster than incomes over the past decade, and the city has the highest price-to-rent ratio globally.
In the “Elevated” risk category, Los Angeles, Dubai, Amsterdam and Geneva all scored 1.1, suggesting prices are increasingly diverging from fundamentals, even if they have not yet reached severe bubble territory.
Cities in the “Moderate” category—including Toronto, Sydney, Madrid, Frankfurt, Vancouver, Munich and Singapore—recorded risk scores of 0.6–0.8, indicating ongoing price pressure without the same level of fragility.
Meanwhile, the “Low” risk group included Hong Kong, London, San Francisco, New York, Paris, Milan and São Paulo. UBS put Milan at 0.0, while São Paulo scored -0.1, suggesting prices there remain more aligned with underlying fundamentals than in many other cities.
UBS said the rankings serve as a warning for investors and asset managers, noting that in high-risk cities a housing market correction could significantly affect real-estate holdings—particularly portfolios concentrated in markets such as Miami, Tokyo or Zurich.
Rising housing costs may also complicate corporate strategy, from location decisions and long-term investment to workforce retention. As the cost of living climbs, employees may relocate to more affordable areas, creating a hidden cost that employers may need to factor in going forward.
