Real Estate
22cool
Median position across economies | Data for Q2 2026
Hot and cold describe position, not good or bad: warm does not mean a fall is coming, and an extreme reading does not mean a quick reversal. We describe history only, with no buy or sell advice.
What it is
Inflation-adjusted residential property prices compiled by the BIS (quarterly data) for the US, the euro area, the UK, Japan, China, South Korea, Australia and Canada. The headline reading is the median of their positions.
House prices affect household wealth and the health of banks, and often come under pressure when rates rise. This dataset does not cover Taiwan.
Taiwan not included.
Where it stands now
coldcoolneutralwarmhotHatched = earlier periods that were also cool
| Economies | Percentile | Level | Data month |
|---|---|---|---|
| Japan | 56 | neutral | Q4 2025 (not updated for more than 9 months; left out of this issue’s median) |
| Australia | 52 | neutral | Q2 2026 |
| US | 47 | neutral | Q2 2026 |
| Euro area | 45 | neutral | Q1 2026 |
| South Korea | 22 | cool | Q2 2026 |
| UK | 12 | cold | Q2 2026 |
| Canada | 6 | coldat an extreme | Q2 2026 |
| China | 1 | coldat an extreme | Q2 2026 |
When it was here before
US stocks after it began, cumulative1 yr2 yr3 yr
For each period, the changes 1, 2 and 3 years after it began are cumulative and measured from its first month; “What happened next” is measured from every cool month, so the two give different numbers. The events named beside each period are major events of that time, not necessarily related to the readings here.
What happened next
Bars: median cumulative changeEarlier quarters with House prices, 8 economies cool, excluding the current period (44)All quarters (148)
Median of the deepest drop below the starting month within the next 5 years: −0.1% for months with House prices, 8 economies cool; −5.9% for all months.
The cool months come from a small number of market episodes (4), and neighboring months are not independent events; rises and falls are all listed. This is the historical record, not a forecast. “US stocks” means the S&P 500 price index compiled by Professor Shiller (monthly average, excluding dividends).
| Median position | Back to neutral (40–60) | Still no warmer than cool | |
|---|---|---|---|
| 1 yr later | 33cool | 20% | 80% |
| 3 yr later | 42neutral | 41% | 44% |
| 5 yr later | 54neutral | 62% | 19% |
Has hot or cold lined up with later returns?
1989–2021: average yearly change in US stocks over the next 5 years
In this period, the hotter the month, the lower the average over the next 5 years. The months overlap, so there are really only a few market episodes. This is a tendency, not a rule, and not a forecast.
What it is linked to
US 10-yr yieldtoHouse prices, 8 economiesCommon explanation: Cause · opposite direction
Rising mortgage rates weigh on house prices
One of the two has no data yet for this issue.
Not visible in our dataAgreement +0.01 · in step in 1 of 8 5-year periods
US stocks and House prices, 8 economies are often linked: both are driven by interest rates and how loose or tight money is. They share a common source, so we do not draw a link between them.
Data and sources