Real Estate Market Overheating Indicators Checklist

General Information & Market Context

Key Market Indicator Inputs (User-Researched Values)

Affordability Metrics

Calculated Price-to-Income Ratio: N/A

Calculated Price-to-Rent Ratio: N/A

Price Trends

Market Activity & Sentiment (User Assessment)

Economic Context

Important Notes & Limitations

  • This checklist provides a simplified assessment based on your inputs and **illustrative thresholds.** It is NOT a definitive bubble prediction or financial advice.
  • **Thresholds Used (Illustrative):**
    • Price-to-Income: <4 (Low), 4-7 (Moderate), 7.1-10 (High), >10 (Very High).
    • Price-to-Rent: <15 (Low), 15-20 (Moderate), 20.1-25 (High), >25 (Very High).
    • Appreciation vs. Inflation: Flagged if appreciation significantly outpaces inflation (e.g., >5-7% above for 1yr, >3-5% for 5yr avg).
    • Speculative Activity: "High" or "Very High" is a flag.
    • Lending Standards: "Loose" or "Very Loose" is a flag.
    • Supply/Demand: "Significantly Undersupplied" can drive prices but also be a fundamental factor. "Significantly Oversupplied" can pose future risk. This tool flags high speculation/loose lending more directly as bubble contributors.
  • Real estate markets are highly localized and influenced by many complex factors not captured here.
  • The interpretation of these indicators can be subjective and should be part of a broader due diligence process.
  • Always consult with local real estate professionals and qualified financial advisors before making investment decisions.
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