IMF warns of real estate bubble

IMF: Israel's housing market is overpriced and a sharp correction will cause recession. The IMF implies in its annual report on Israel, published yesterday, that there is a real estate bubble in the country. It says that home prices are now 25% above their equilibrium value, after rising 80% in the past six years since 2007. Home prices relative to income and home prices relative to rents are 26% and 22% above the long-term level.