Confirming what you may already know, the Union Bank of Switzerland published a report saying that San Francisco is “the most overvalued US urban housing market” out of all regions included in a study, and faces the greatest risk of a burst housing bubble out of all American cities.
To back this up, UBS cites some alarming statistics. Via a press release the firm said of SF’s housing market:
In San Francisco, in the wake of the technology boom and buoyant foreign demand, real house prices have soared 65 percent since 2012. Price growth has slowed in recent quarters, but remains 6 percent above the national average.
Despite the thriving economy, average incomes have risen only 10 percent since 2012 and have not kept pace with house prices, worsening housing affordability further.
The San Francisco Business Times points out that San Francisco faces the greatest “bubble risk” out of all cities in America, meaning that if San Francisco’s real estate bubble were to burst, the fallout would be drastic. Still, apparently that risk is somewhat limited, as CNBC saidthat elsewhere in the report, SF’s risk is minimized due to “its strong economic fundamentals amid the astonishing boom of tech companies.”