Los Angeles has a higher price-to-income score and a significantly higher price-to-rent score compared to San Francisco, indicating a greater risk of a housing bubble.
Price bubbles indicate a housing market is overvalued. The study's methodology clarifies that an overvalued market doesn't necessarily mean the bubble will burst.
With interest rates declining after the federal cut, the California real estate market, particularly in cities like San Francisco, could see a significant rebound.
The risk of a housing bubble in Los Angeles has increased, driven by a high cost of ownership relative to renting and a falling population.
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