Vancouver’s “significantly overvalued” housing market is among the most bubbly in the world, a new report suggests.
The UBS Global Real Estate Bubble Index, which launched this week, puts Vancouver at No. 4 behind London and Hong Kong, and just a shade behind Sydney.
In fact, Vancouver and Sydney are so close together that they’re virtually tied for the third spot in a ranking where No. 1 is not where you want to be.
The UBS report backs up other warnings about Vancouver, which, along with Toronto, has been the focus in Canada when it comes to the word “frothy.”
“Bubble risk is most distinct in London and Hong Kong,” said the study, which looked at price-to-income and price-to-rent ratios and a handful of other measures.”
“Deviations from the long-term norm point to significantly overvalued housing markets in Sydney, Vancouver, San Francisco and Amsterdam.”
According to this study, Vancouver prices in 2015 were up by 25 per cent since 2006, suggesting that valuations “look very stretched,” although the “dynamic has slowed significantly of late.”
For the record, as The Globe and Mail’s Tamsin McMahon reports, Canada Mortgage and Housing Corp. said yesterday that Vancouver is at low risk of a correction.
