UBS On-Air: Market Moves Across the Pond: Dream Home or Bubble Trouble?
Oct 7, 2025
Matthias Holzhey and Maciej Skoczek, Zurich-based real estate experts from UBS Chief Investment Office, dive into the dynamics of overseas property investment. They discuss historical housing performance, the impact of inflation and public debt, and key metrics for assessing bubble risks. While highlighting cities like Miami and Tokyo as high-risk areas, they offer insights into practical considerations like currency management. Holzhey even shares favorite spots for second homes, advocating for diversification through mortgage financing. It's a compelling blend of aspiration and caution in global real estate!
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Housing Matches Equities Long-Term
- Housing has delivered returns comparable to equities over the long run, driven by rising land value and urbanization.
- Leverage magnifies housing returns because mortgages allow large exposure with limited equity.
Debt, Inflation And Real Estate Link
- High public debt and potential inflation raise the appeal of real estate as inflation erodes debt value.
- Financial repression and low real rates make borrowing cheaper and push capital toward housing.
Define Your Purpose Before Buying
- Clarify why you buy: holiday use, university housing, or buy-to-let determine strategy and metrics.
- Assess rental potential, currency exposure, and fit with your overall wealth plan before buying.