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BS's 2024 Global Real-Estate Bubble Index reveals a decline in bubble risks over the past year, with only six cities now at elevated or high risk, down from 16 last year. Miami and Los Angeles are the two US cities most vulnerable to a housing bubble, according to the report.

    The index, released by UBS last week, shows that falling home prices have contributed to the decline in bubble risks. Inflation-adjusted housing prices in analyzed cities are now about 15% lower than their mid-2022 levels when interest rates began to surge globally. Cities with high risk of a real estate bubble in previous years have seen the strongest price corrections.

    To create its index, UBS considered various metrics such as local home price-to-income ratios and mortgage-to-GDP ratios. Cities with scores above 1.0 are considered at elevated risk, while those with scores above 1.5 are considered high risk. The six cities with elevated or high bubble risks are listed below in ascending order.

    6. Geneva, Switzerland - UBS bubble risk score: 1 (elevated)

    5. Toronto, Canada - UBS bubble risk score: 1.03 (elevated)

    4. Los Angeles, California - UBS bubble risk score: 1.17 (elevated)

    3. Tokyo, Japan - UBS bubble risk score: 1.67 (high)

    2. Miami, Florida - UBS bubble risk score: 1.79 (high)