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Expand chart
Reproduced from UBS; Chart: Axios Visuals

Housing and real estate are going through a period of systemic change that could reshape how we think about the sector in years to come.

What's happening: Prices in the largest U.S. cities have stagnated for the first time since 2011, mortgage applications are falling and even ultra low interest rates have not been enough to lure buyers back to the market, data shows.

What it means: "Mortgage interest rates in many cities aren't the major challenge for house buyers anymore," Claudio Saputelli, head of real estate at UBS Global Wealth Management, said in the asset manager's annual Global Real Estate Bubble Index.

  • "Many households simply lack the funds required to meet the banks' financing criteria, which we believe poses one of the biggest risks to property values in urban centers."
  • Buying a 650-square-foot apartment exceeds the budget of people who earn the average annual income in the highly skilled service sector in most world cities, per UBS.

Why it matters: It's the end of the boom, Saputelli and Matthias Holzhey, head of Swiss real estate investments, write. The exponential rise in housing prices combined with a lack of major wage gains for average American workers over the last 3 decades may have finally topped the fast-growing urban housing market.

  • Real prices in all 4 of 2016's top-ranking cities have fallen. On average they are down by 10% from their respective peaks.
  • "Owning residential property in global cities has been a sure road to wealth accumulation. However ... real price appreciation can no longer be taken for granted."

Details: Currently, the analysts see 7 cities at high risk of being in a real estate bubble, but more importantly they see a rethink of housing as an asset taking place across the world's developed economies.

  • While the U.S. housing bubble risk has receded as prices have stagnated, the eurozone is now at the greatest risk of a housing bubble, as ultra-low interest rates have helped push many of Europe's cities to price levels reminiscent of bubbles past, UBS analysts said in the paper.

Go deeper: U.S. mortgage rates rise while applications and home prices slow

Go deeper

Scoop: Gina Haspel threatened to resign over plan to install Kash Patel as CIA deputy

CIA Director Gina Haspel. Photo: Win McNamee/Getty Images

CIA Director Gina Haspel threatened to resign in early December after President Trump cooked up a hasty plan to install loyalist Kash Patel, a former aide to Rep. Devin Nunes (R-Calif.), as her deputy, according to three senior administration officials with direct knowledge of the matter.

Why it matters: The revelation stunned national security officials and almost blew up the leadership of the world's most powerful spy agency. Only a series of coincidences — and last minute interventions from Vice President Mike Pence and White House counsel Pat Cipollone — stopped it.

Updated 5 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus deaths reach 4,000 per day as hospitals remain in crisis mode — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden says, "We will manage the hell out of" vaccine distribution — Biden taps ex-FDA chief to lead Operation Warp Speed amid rollout of COVID plan — Widow of GOP congressman-elect who died of COVID-19 will run to fill his seat.
  3. Vaccine: Battling Black mistrust of the vaccines"Pharmacy deserts" could become vaccine deserts — Instacart to give $25 to shoppers who get vaccine.
  4. Economy: Unemployment filings explode againFed chair: No interest rate hike coming any time soon —  Inflation rose more than expected in December.
  5. World: WHO team arrives in China to investigate pandemic origins.

John Weaver, Lincoln Project co-founder, acknowledges “inappropriate” messages

John Weaver aboard John McCain's campaign plane in February 2000. Photo: Robert Schmidt/AFP via Getty Images)

John Weaver, a veteran Republican operative who co-founded the Lincoln Project, declared in a statement to Axios on Friday that he sent “inappropriate,” sexually charged messages to multiple men.

  • “To the men I made uncomfortable through my messages that I viewed as consensual mutual conversations at the time: I am truly sorry. They were inappropriate and it was because of my failings that this discomfort was brought on you,” Weaver said.
  • “The truth is that I'm gay,” he added. “And that I have a wife and two kids who I love. My inability to reconcile those two truths has led to this agonizing place.”