Peter Schiff isn't the guy who's going to walk you through an open house and tell you to follow your heart. He's the guy who'll tell you to run -- especially if you think buying a home is the best way to build wealth.
Last year, on "The Iced Coffee Hour" podcast, the economist and market strategist challenged the belief that owning a home is always a smart financial move. Schiff didn't hesitate when asked if buying made more sense than renting.
"For a lot of people -- and this has been the case for a long time -- renting is a better option," he said.
Don't Miss:
He blamed part of the confusion on tax policy and government subsidies that have distorted the real costs of owning a home.
"There's much bigger government subsidies for buying a home rather than renting. And so that's caused people who might otherwise have been better off renting to buy instead because they're taking into account the tax benefits," Schiff said.
The hosts pointed out that, for many Americans, owning a home acts as their only real form of savings. Schiff quickly pushed back.
"Houses are expensive," he said. "A house depletes your savings. It's a money pit."
"There were a lot of people that were pressed into homeownership by overzealous realtors who make a big commission," Schiff said. "Realtors kind of perverted the American dream into homeownership -- like that's the American dream: buy a home and get rich. As if the home makes you rich."
Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing -- this is your last chance to become an investor for $0.80 per share.
Schiff went on to argue that the structure itself loses value over time, while only the land keeps up with inflation.
He warned that the long-term costs of owning -- maintenance, insurance, and taxes -- often outweigh whatever appreciation people think they're getting.
"You have to pay insurance costs that have basically doubled over the last few years," he said. "You have to pay much higher maintenance costs. You have to pay higher local property taxes. Everything related to buying a home is a lot more expensive."