However, UBS and Deutsche Bank judged real estate in U.S. cities to be mostly fair-valued, even in New York. San Francisco was singled out as an exception by UBS, with prices fueled by foreign demand and the fast-growing economy of Silicon Valley. Chicago, meanwhile, was judged to be undervalued relative to its own history.
"Even in the U.S., pockets of potentially lofty valuations are surfacing. Commercial real estate prices are now 13 percent above the pre-crisis peak, while the price of farmland has nearly doubled in real terms over the past decade," Deutsche Bank said.
Several emerging markets have also joined the rally, with residential real estate prices rising sharply in India, Turkey, Hungary, the Philippines and Thailand in the first three months of the year, according to the Bank for International Settlements (BIS).
However, these gains were dwarfed by the 17 percent increase posted by Ireland — a country hit hard when its property market collapsed in 2007.
Countries that proved exceptions to the rule include France, Greece and Italy, where real residential property prices mostly fell in the first quarter of 2015. Plus, China and Russia both posted sharp falls in prices, according to the BIS.