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UBS: Tel Aviv housing market overvalued but not bubble risk

Tel Aviv credit: Shutterstock
Tel Aviv credit: Shutterstock
20 Sep, 2023 12:53
שלח תגובה במיילArik Mirovsky

The UBS Global Real Estate Bubble Index 2023 says that rising inflation and interest rates have led to a sharp decline in imbalances in Tel Aviv's housing market.

Tel Aviv's housing market has been re-categorized from the 'red' bubble risk category to the 'yellow' overvalued category in the UBS Global Real Estate Bubble Index 2023. UBS observes, "The global surge in inflation and interest rates over the past two years has led to a sharp decline in imbalances in the housing markets of global financial centers on average." As a result Tel Aviv is one of seven cities moving from bubble risk to overvalued along with Toronto, Frankfurt, Munich, Hong Kong, Vancouver and Amsterdam. Only Zurich and Tokyo remain as bubble risk cities in the housing market.

On Tel Aviv, the UBS report says, "Between 2002 and 2022, real house prices in Tel Aviv tripled, the highest growth of all cities we analyzed. Rising mortgage rates during 2022 put an abrupt end to this boom. Mortgage volume growth has more than halved since last year and real price growth was negative in the first half of 2023. This moderate easing of prices will likely continue as there are no signs of a demand rebound and unsold inventories have been piling up amid a full construction pipeline."

Published by Globes, Israel business news - en.globes.co.il - on September 20, 2023.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.

Tel Aviv credit: Shutterstock
Tel Aviv credit: Shutterstock
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