Miami tops global real estate bubble risk, but US cities show diverging trends

UBS has again named Miami the global city most at risk of a real estate bubble, according to its 2025 Global Real Estate Bubble Index. The report placed Miami ahead of Tokyo and Zurich, with a bubble risk score of 1.73—down slightly from last year, but still the highest among 21 major cities analyzed.

UBS attributed Miami’s ranking to its price-to-income, price-to-rent, and prices compared to the national average. It has posted the strongest inflation-adjusted housing appreciation among all cities in the study.

The report noted that while price growth has slowed, “a sharp correction appears unlikely at this stage. Miami's coastal appeal and favorable tax environment continue to attract newcomers from the US West and Northeast, with real estate prices still well below those in New York and Los Angeles.”

“Miami is where ultra-high-net-worth individuals want to live,” MIAMI chairman of the board Eddie Blanco previously said.

“Miami real estate offers more bang for your millions, a business-friendly government, no state income tax, FinTech hub, 365-day sunny weather and more. Meanwhile, the data shows that affordable 30-year condo units are maintaining their price appreciation. The condo market is the entry market for first-time homebuyers.”

Los Angeles, meanwhile, landed in the “elevated risk” category with a score of 1.11, ranking fourth globally.

“Los Angeles is among the least affordable cities in the US, contributing to a shrinking population,” UBS said. The city’s high price-to-rent ratio has kept homeownership out of reach for many, and “prices are likely to trend downward if mortgage rates do not drop,” the report added.

San Francisco and New York, by contrast, fell into the “low risk” category, with scores of 0.28 and 0.26, respectively. San Francisco’s affordability issues persist, despite incomes outpacing home prices in recent years.

“Affordability remains a major hurdle, even though incomes have outpaced home prices over the past seven years,” UBS said.

However, rental growth has accelerated as “return-to-office mandates and strong AI hiring draw higher-income tenants back to the city,” likely increasing demand for owner-occupied housing.

New York’s luxury market has benefited from a strong stock market, while in-person work mandates have pushed up rents.

“Return-to-office normalization and steady job growth, especially in higher-income segments, have been pulling more renters into the city, increasing competition for limited listings,” UBS said.