Global Real Estate Bubble Index 2024

Imbalances have declined in Europe, remained stable in Asia-Pacific, and increased in the US. While Miami tops the bubble risk ranking this year, Dubai has recorded the highest risk increase since mid-2023.

Where high imbalances accumulated, real house prices have shed 20% since mid-2021. This compares to a correction of 2% on average for all other cities in the study.

Average real house prices increased by 2% compared to last summer. But, price changes were uneven: While real prices in Paris and Hong Kong fell by 10%, Warsaw and Dubai recorded double-digit increases.

Building permits have been declining in most cities amid deteriorating financing conditions. Real rents have accelerated in a majority of cities and increased by more than 5% on average over the last two years.

Buyers can afford 40% less living space than in 2021, before interest rates increased. As a result, fewer properties are being bought, apparent in sharply lower growth of outstanding mortgage volumes.

With financing costs set to become more attractive, housing demand is bottoming out and prices should accelerate. Economic growth will be crucial in determining the price dynamics.