Economist Robert Shiller: Buying a house is 'a consumption choice,' not an investment

Robert Shiller isn&#039;t too bullish on home ownership

(Image credit: Time/YouTube)

published 29 June 2015

Robert Shiller, an economist at Yale, won a Nobel Prize in 2013 for his analysis of asset prices, and his name is half of the much-watched Case-Shiller Index of housing prices. It turns out, he's not too enthusiastic about home ownership, either as a lifestyle choice or an investment. Buying a house is "like a consumption choice, it's not really an investment," he tells Money magazine's Susie Poppick in the video below.

Renting, especially if you don't have a steady job or don't plan to be in the same place for 10 years, "is just going to make your life easier," he said. There are some instances in which buying makes sense, but home ownership is like parenthood, he added:

First of all, do you really want to buy a house? It's sort of like having a baby: You're going to be working, you're going to be worrying about this house. It's going to break down, you're going to get termites, you're going to have a snowstorm and have to get the roof shoveled, all these things. And then on top of that, it keeps needing painting and maintenance, and it's a headache. [Shiller, to Money]

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.