IMF Starts Global Housing Index to Analyze Boom-Bust Cycles

The International Monetary Fund has started publishing analysis of housing markets around the world to help ensure boom-to-bust cycles are identified and avoided before they start another financial crisis.

“While a recovery in the housing market is surely a welcome development, we need to guard against another unsustainable boom,” IMF Deputy Managing Director Zhu Min wrote in a blog post today. The fund’s Global Housing Watch will be updated quarterly.

Global housing prices have risen for seven straight quarters, according to the Washington-based fund’s new global index. Countries where housing remains “still too pricey” include Belgium, Canada, Australia, New Zealand, France and the U.K., according to the fund.

Ratios of house prices to rents and incomes “remain well above the historical averages for a majority of countries,” Zhu wrote.

To contact the reporter on this story: Brendan Murray in Washington at brmurray@bloomberg.net

To contact the editors responsible for this story: Chris Wellisz at cwellisz@bloomberg.net Mark Rohner, Gail DeGeorge

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