Social Networks Influence Home Buyers
Social networks can carry a lot of weight in people’s lives, even having an impact on their real estate decisions. In a recent REALTOR® University Speaker Series presentation, Dr. Johannes Stroebel presented research about the influence of social networks on buyers’ home purchase decisions.
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 found that a positive home price experience of an individual’s social network who resided in other geographic areas had an impact, such as increasing the chance of the individual becoming a home owner, increasing the size of property the individual purchased, and even increasing the individual’s purchase price, according to Stroebel, an associate professor of finance at New York University Stern School of Business.
Stroebel says that an individual whose social network lives in geographic areas where prices are rising were more likely to purchase a home than an individual who has a social network who was experiencing greater price variability, like some increasing and some decreasing.
“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.
Source: “Social Network and Housing Markets: A REALTOR® University Speaker Series Presentation,” National Association of REALTORS®Economists’ Outlook blog (March 6, 2017)