The uneven booms in global housing and what they mean for investors

As some cities ride a rising wave, others are bruised by corrections

- Tan Min Lan

Singapore has maintained its "moderate bubble risk" status in the UBS Global Real Estate Bubble Index, as private home price gains halved to 3 per cent, while rents rose by 2 per cent. Much of this stability stems from Singapore's disciplined policy approach, said the writer.

(ST PHOTO: KUA CHEE SIONG)

Real estate has long been prized as a quiet engine of private wealth - a “safe” store of value, a generational asset, a hedge against inflation.

For many households, the family home is their largest asset; for many investors, prime real estate is the bedrock of their portfolio.

But today, that familiar narrative is under strain. Amid geopolitical uncertainty and mortgage rates still nearly twice the level in 2020-2022, direct investment in real estate has held steady, rising another 8 per cent year on year in the first half of 2025, according to Savills. In this time of stretched affordability and rising debt, what’s evident is the bifurcation in the geography of risk - some cities are still riding a rising wave, while others are already bruised by corrections.

Now in its 11th year, the UBS Global Real Estate Bubble Index seeks to gauge housing market excesses (or “bubble risk”) across 21 key financial centres globally. It does so by identifying a sustained decoupling of home prices from fundamentals — such as local incomes and rents - and imbalances in the real economy, including excessive lending and construction activity.