Instant Alert: UBS: These 8 housing markets around the world are closest to a bubble

MANAGE SUBSCRIPTIONS   |   UNSUBSCRIBE   |   VIEW ONLINE   UBS: These 8 housing markets around the world are closest to a bubble by Akin Oyedele on Sep 28, 2017, 11:45 AM Advertisement Homeowners in Toronto face the biggest risk worldwide of seeing their property values collapse.  That's according to UBS' latest annual Global Real Estate Bubble Index, which examines which housing markets have experienced unsustainable price increases.  "Annual price-increase rates of 10% correspond to a doubling of house prices every seven years, which is not sustainable," the report said. "Nevertheless, the fear of missing out on further appreciation predominates among home buyers."  Buyers are being egged on by easy financing conditions, growing wealth among the ultra-rich, and a shortfall of building supply relative to demand, the report said. By overblowing the impact of these three factors, homebuyers have driven at least eight cities into bubble territory. Toronto and Amsterdam were the new additions this year to this cohort of cities where home prices have increased by more than 50% since 2011.  Here's the full list in ascending order of the bubble index:   SEE ALSO: Wall Street analyst unleashes on Jamie Dimon and everyone else calling bitcoin a fraud Amsterdam "Since 2015 real prices have increased by 30% and the city has entered bubble-risk territory. The city’s housing market sharply decoupled from the weak countrywide housing market. Deviations from market fundamentals in the capital are, however, not extreme." Hong Kong "Residential market prices reached an all-time high in midyear. Thus the UBS Global Real Estate Bubble Index score for Hong has increased significantly. Prices — especially for smaller dwellings — surged in the last four quarters. In real terms they are close to three times higher than in 2003, having increased at an average annual growth rate of 10%. Real rents rose in the same period by 3%, while incomes were unchanged." London "London's inflation-adjusted housing prices are almost 45% higher than five years ago and 15% higher than before the financial crisis a decade ago. But real income remains 10% lower than in 2007. The rise in house prices, however, has been decelerating since the UK referendum in June 2016, and real prices are 2% lower. The UBS Global Real Estate Bubble Index score for London dropped to 1.77, but remains in bubble-risk territory." See the rest of the story at Business Insider   Share the latest business news with your network:    Email sent to:   |   Manage your email preferences   |   Unsubscribe Terms of Service   |   Privacy Policy Business Insider. 150 Fifth Avenue, New York, NY 10011