Is Miami Really World's Most Overvalued Residential Real Estate Market?

Miami Condo Mondays™ is a live podcast hosted by Peter Zalewski of the Miami Condo Investing Club™ and veteran broker Jenny Huertas of CVRRealty.com providing an in-depth look at the latest residential real estate trends in South Florida.

Recorded weekly in Greater Downtown Miami, the podcast offers a one-hour discussion on various real estate topics, including preconstruction condos, market trends and investment strategies.

The hosts share their expertise, with Zalewski focusing on macro perspectives and Huertas offering micro insights from her on-the-ground experience.

Tune in every Monday at 4 PM (EST) on the social media accounts of Peter Zalewski and Jenny Huertas for insights on the latest trends in the South Florida condo market.

In this episode of the Miami Condo Mondays™ podcast, Zalewski and Huertas discuss why Miami has been ranked as the world’s most overvalued residential real estate market for a second consecutive year.

This UBS Global Real Estate Bubble Index 2025 comes as Miami’s market shows signs of slowing, with rising inventory and a sharp divergence between property prices and local incomes or rents.

Miami’s real estate market has the highest bubble risk of any of the 21 global cities analyzed in the recent UBS report, with its index score of 1.73 indicating a sustained mispricing of assets.

The city’s risk level surpasses that of the only other financial hubs in the “high-risk” category: Tokyo (1.59) and Zurich (1.55).

The “elevated-risk” category consists of four cities: Los Angeles (1.11), Dubai (1.09), Amsterdam (1.06), and Geneva (1.05).

Zalewski noted that Miami’s unique situation is driven by a high volume of second-home buyers and corporate investors who use units for short-term rentals or hold them as assets rather than housing for local residents.

The report highlights that renting is now significantly cheaper than owning in Miami.

This is compounded by rising maintenance fees, hefty special assessments and pricey insurance premiums that are putting financial pressure on condo owners.

“Regulatory changes are forcing costly repairs on older buildings, and many owners are feeling the pinch,” Huertas said.

The UBS index warns that while a sharp correction is unlikely without a major external shock - a black swan event - price growth is expected to turn negative.

Huertas pointed out that Miami’s appeal to wealthy international buyers especially from Latin America provides a stabilizing factor that differentiates it from past cycles.

Contrast Miami’s high-risk designation with other international cities. Sao Paulo is considered undervalued while major centers like Milan, Paris and New York are rated as fairly priced.

“Those cities are expensive for locals, but their markets are not as disconnected from their economies as Miami’s is,” Zalewski said.

As the hosts concluded the nearly 75-minute discussion, they held differing views on the market’s future.

Zalewski expressed skepticism that international buyers alone could sustain current valuations, predicting a correction is likely, especially for mid-range properties.

Huertas argued the luxury segment will prove more resilient.

Both advised listeners to stay informed and prepare for opportunities that may arise from a shifting market.

“Global demand for luxury properties in Miami isn’t going away,” Huertas said. “That segment of the market operates by its own rules.”