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Clear out junk files and repair common Windows errorsFree Scan →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →UBS’s 2026 Global Real Estate Bubble Index identifies Zurich and Tokyo as high-risk markets, five others as elevated risk, and three as moderate risk. The ten-city selection below is not a strict score-ranked top ten: it groups the markets by UBS’s published risk categories and explains the warning signs the bank highlights. The index assesses vulnerability to a correction, not whether or when a crash will happen.
How to read UBS’s 2026 housing-bubble assessment
UBS defines a housing bubble as significant and sustained property-price overvaluation, typically evident only after a correction. Its index examines signals such as gaps between prices and incomes or rents, excessive credit growth, and construction activity. A high-risk designation therefore indicates vulnerability, not a prediction of a correction date. Macroeconomic conditions, investor sentiment, or housing supply could act as catalysts, but the index does not say when declines will occur.
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The 2026 index covers 23 major cities, with Seoul and Lisbon added for the first time. UBS’s release provides categories rather than a complete score-ranked top-ten list in its accessible text. The ten markets here follow Quartz’s selection; cities within a category are not presented in a strict order. UBS Global Real Estate Bubble Index 2026 and Quartz’s featured selection provide the underlying context.
Which markets are in the ten-city selection?
| Market | UBS 2026 risk category | Signals UBS highlights |
|---|---|---|
| Zurich | High | Highest risk in the index; high and rising price-to-rent ratio, low financing costs, constrained supply, and near-zero vacancy. |
| Tokyo | High | Long-running price gains have outpaced incomes and affordability is tightening, although imbalances eased over the latest year. |
| Miami | Elevated | Moved down from the highest position in the prior two editions. Affordability pressures, borrowing costs, and rising insurance premiums have weighed on demand. |
| Dubai | Elevated | Risk eased after peaking in March but remains elevated; UBS reports widening gaps between prices, incomes, and rents over the year. |
| Seoul | Elevated | New to the 2026 sample; risk rose sharply, with real house prices up around 10% over the reported year. |
| Geneva | Elevated | UBS links increasing risk to low Swiss financing costs. |
| Lisbon | Elevated | New to the 2026 sample; UBS reports nearly 7% annualized real price growth over the past decade and another roughly 10% rise since mid-2025, alongside stalled rental growth. |
| Hong Kong | Moderate | Real house prices rose around 10% over the reported year and imbalances widened, but UBS still classifies the market as moderate risk. |
| Madrid | Moderate | Real house prices rose around 10% over the reported year and imbalances widened. |
| Milan | Moderate | Risk increased over the year and prices moved further from fundamentals, though the market remains in the moderate category. |
The approximate price movements are UBS’s reported real-price changes, not forecasts. A rise in prices alone does not establish a bubble: the index also considers how prices relate to local incomes and rents, as well as credit and construction activity.
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What the categories say—and what they do not
High risk: Zurich and Tokyo
Zurich is the index’s highest-risk market. UBS points to the combination of elevated and rising price-to-rent ratios, low financing costs, limited supply, and near-zero vacancy. Tokyo’s long period of price growth has outpaced incomes, tightening affordability; UBS nevertheless says its imbalances eased over the latest year.
Elevated risk: Miami, Dubai, Seoul, Geneva, and Lisbon
These markets share the elevated tier, but their pressures differ. Miami’s position has fallen from the highest in the previous two editions, with affordability, borrowing costs, and insurance premiums acting as headwinds. Dubai’s risk has eased from its March peak even as prices pulled further away from incomes and rents. Seoul and Lisbon are new additions to the city sample; UBS reports sharply higher risk in Seoul and fast long-term real price growth in Lisbon. Geneva’s rising risk is linked to low Swiss financing costs.
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Moderate risk: Hong Kong, Madrid, and Milan
Moderate does not mean that prices or imbalances are static. UBS reports around 10% real price growth in Hong Kong and Madrid over the year, with widening imbalances in both. Milan’s risk also increased as prices moved further from fundamentals, but UBS retains its moderate classification.
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Why affordability and price relationships matter
UBS’s warning signals are relational: whether home prices are moving away from household incomes and rents, and whether credit or construction is adding to vulnerabilities. Financing costs can alter what buyers can afford and how investors value rental income. Local conditions matter too; Zurich’s constrained supply and very low vacancy, for example, are part of UBS’s explanation, not evidence that all high-priced cities face the same pressures.
Affordability is strained across much of the sample. UBS says the annual cost of owning a newly purchased 60-square-meter (650-square-foot) home—including mortgage interest and maintenance—exceeds 40% of a highly skilled worker’s gross income in most cities studied. That is a broad finding across the index, not a figure for every city in this ten-market selection.
Recent gains do not make the list a forecast
UBS reports that Seoul, Lisbon, Madrid, and Hong Kong each saw real house prices rise around 10% over the reported year. In contrast, Vancouver and Toronto recorded approximate real declines of 10%. These figures illustrate how differently markets can move; they do not establish what prices will do next.
Historical outcomes also require care. UBS says markets it classified as high risk in 2021 later experienced average real price declines of roughly 15%. That is a retrospective average for that group, not a guaranteed outcome—or a timing estimate—for Zurich, Tokyo, or any other market now classified as high risk.
What UBS says about the outlook
Matthias Holzhey, lead author of the study and economist at UBS Global Wealth Management’s Chief Investment Office, said: “Higher-for-longer financing costs are likely to cap house-price gains in the near term.” That is UBS’s outlook, not a prediction that prices will fall in every market.
Maciej Skoczek, study author and economist at UBS Global Wealth Management’s Chief Investment Office, said: “At current valuations, housing in most cities is nevertheless likely to provide inflation protection over the medium term.” This statement likewise reflects UBS’s view, not a promise of returns for a specific city or property.
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