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Economist Peter Schiff made his name by predicting the 2008 housing crash. Now he’s sounding the alarm on another potential crisis in America’s housing market — one that could see a wave of homeowners mailing back their keys.
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“Why are housing prices so high? Because for a long time, the Fed kept interest rates at zero and so a lot of people were able to get really low mortgages, 3% mortgages, 4% mortgages,” Schiff explained in a recent YouTube video [1].
“And because homes are bought — not based on what the home cost — but based on the monthly payment, the lower the monthly payment, the more somebody could pay for a house. Now you have a problem where housing prices went way up, but then mortgage rates went way up and home prices never came back down to levels consistent with more expensive mortgages.”
Indeed, mortgage rates have surged. The average rate on a 30-year fixed mortgage has climbed from below 3% just a few years ago to more than 6% today [2]. Normally, higher borrowing costs can cool down the market, but prices remain stubbornly high: the S&P CoreLogic Case-Shiller U.S. National Home Price Index has jumped more than 50% over the past five years [3].
Schiff believes prices will “eventually” fall to match today’s higher rates — a painful adjustment that, he warns, could trigger “a housing emergency.”
“It’s going to create a bunch of defaults and a lot of people are going to walk away and mail in their keys because they can’t sell their houses for more than they owe,” he said.
The scenario sounds familiar. During the 2008 bust, many underwater homeowners — those who owed more than their homes were worth — simply mailed their keys to the lender and walked away.
Today’s market is different. Lending standards are tighter than during the subprime era, making widespread negative equity less common. Supply constraints are also a factor: Zillow estimates the U.S. is short roughly 4.7 million homes, a gap that has helped keep prices elevated [4].
Still, Schiff remains wary. He argues that many owners are staying put only because they locked in ultra-low mortgage rates, limiting the number of homes for sale.
“But at some point, there are people that have to sell their houses for whatever reason and if they have to slash the prices to do it, they may not have enough money to repay the mortgages. And so this could have a cascading effect,” he warned.
Schiff’s golden hedge
When economic clouds gather, gold often returns to the spotlight.
Unlike paper currency, the precious metal can’t be printed at will — and it isn’t tied to the fortunes of any single country or economy. That makes it a popular refuge when a downturn looms.
Gold has rallied more than 40% over the past 12 months and Schiff expects further gains.
Read more: Robert Kiyosaki warns of a ‘Greater Depression’ coming to the US — with millions of Americans going poor. But he says these 2 ‘easy-money’ assets will bring in ‘great wealth’. How to get in now
“I still think we have a good shot at hitting $4,000 gold by the end of the year,” he said in a recent episode of his Peter Schiff show [5].
Major banks share a similar outlook: Goldman Sachs [6] and JPMorgan [7] both forecast that gold could hit $4,000 an ounce by 2026.
For investors, a gold IRA is one option for building up your retirement fund with a safe-haven asset.
Opening a gold IRA with the help of Goldco allows you to invest in gold and other precious metals in physical forms while also providing the significant tax advantages of an IRA.
With a minimum purchase of $10,000, Goldco offers free shipping and access to a library of retirement resources. Plus, the company will match up to 10% of qualified purchases in free silver.
If you’re curious whether this is the right investment to diversify your portfolio, you can download your free gold and silver information guide today.
Earn rental income without buying a house
While Schiff is wary of the U.S. housing market, he acknowledges one persistent trend: rising rents.
“Rents go up every year,” he noted on his show [5].
America’s housing affordability crisis is, in part, a reflection of broader cost-of-living pressures — and it underscores how real estate can serve as a hedge. As inflation drives up the cost of materials, labor and land, home values tend to rise as well. Rental income often follows suit, giving landlords a stream of cash flow that adjusts with inflation.
In fact, investing legend Warren Buffett has often pointed to real estate as a prime example of a productive, income-generating asset. In 2022, Buffett remarked that if you offered him “1% of all the apartment houses in the country” for $25 billion, he would “write you a check [8].”
Of course, you don’t need billions — or even to buy a single house — to benefit from real estate investing. Crowdfunding platforms like Arrived offer an easier way to get exposure to this income-generating asset class.
Backed by world class investors like Jeff Bezos, Arrived allows you to invest in shares of rental homes with as little as $100, all without the hassle of mowing lawns, fixing leaky faucets or handling difficult tenants.
The process is simple: browse a curated selection of homes that have been vetted for their appreciation and income potential. Once you find a property you like, select the number of shares you’d like to purchase and then sit back as you start receiving any positive rental income distributions from your investment.
Another option is First National Realty Partners (FNRP), which allows accredited investors to diversify their portfolio through grocery-anchored commercial properties without taking on the responsibilities of being a landlord.
With a minimum investment of $50,000, investors can own a share of properties leased by national brands like Whole Foods, Kroger and Walmart, which provide essential goods to their communities. Thanks to Triple Net (NNN) leases, accredited investors are able to invest in these properties without worrying about tenant costs cutting into their potential returns.
Simply answer a few questions — including how much you would like to invest — to start browsing their full list of available properties.
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[1]. @peterschiff. YouTube post on Sept. 12, 2025
[2]. Federal Reserve Bank of St. Louis. “30-year fixed rate mortgage average in the United States”
[3]. S&P Global. “S&P cotality case-shiller U.S. national home price NSA index”
[4]. Zillow. “US housing deficit grew to 4.7 million despite construction surge”
[5]. @peterschiff. “YouTube post on Sep. 17, 2025”
[6]. KITCO News. “Morgan Stanley, Goldman Sachs, UBS all recommend buying gold after latest Trump tariffs”
[7]. JP Morgan. “Will gold prices break $4,000/oz in 2026?”
[8]. CNBC. “Warren Buffett gives his most expansive explanation for why he doesn’t believe in bitcoin”
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.