Housing investment is a regular topic of discussion on Americans' social networks. About half of the respondents in the study had discussed – either sometimes or often – whether buying a house was a good investment.
The study looked at social network users and how positive real estate stories affected them. It found that positive real estate-buying stories posted by a social network "friend" – even one located in a different geographic area – increased the chances the user would become a homeowner. It even increased the likelihood that the reader would offer a higher purchase price for a property, according to Stroebel, an associate professor of finance at New York University Stern School of Business.
Stroebel says that social networkers who live in an area of rapidly rising real estate prices were also more likely to buy a home than someone in an area where prices varied, such as selling prices that both increased and decreased.
The bottom line: The tone of social network discussions can influence the way people feel about buying or selling real estate, and the references made by online "friends" can influence decisions.
"Realtors® are increasingly using social media and this active social media presence can potentially create business opportunities, as individuals become more aware of housing trends in their areas and discuss these trends with their social network friends," according to NAR's Economists' Outlook blog, detailing Stroebel's presentation.
The full study is posted online.
Source: "Social Network and Housing Markets: A REALTOR University Speaker Series Presentation," National Association of REALTORS Economists' Outlook blog (March 6, 2017)
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