Research from scientists at Harvard, NYU, and Facebook revealed that people whose friends on Facebook experience increased housing prices are more likely to invest in property over the following two years. CNBC staffer Nicholas Wells takes a look at the results of the study which shows a major impact in the relationship between social media network and housing investment decisions as well as the effect of those decisions on local housing markets in aggregate.
One result of the research was that a currently renting person whose friends saw a 5% increase in wealth over the national average in the last two years, was 3.1% more likely to invest in the next two years. the survey also yielded more interesting results:
By matching anonymized Facebook data to housing-transaction data from around the country, the researchers found that individuals could be influenced by distant house-price fluctuations to buy and sell property in their hometown. In the end, the sample included around 1.4 million individuals and over half a million housing transactions.