Online Advertising and Real Estate sales: evidence from the Housing Market

Despite the popular use of online advertising by marketers, little is known about its role in the real estate market. This research aims to investigate how online advertising affects the sales of new houses and explores potential contingent factors and the underlying mechanism. Based on a rich secondary data set and econometric models, we find that online advertising increases the sales of new houses, and the effect is stronger with lower housing prices, higher residential incomes, and lower-tier cities. Additionally, the mechanism is that advertising generates an impact via processes, such as lowering housing prices, attracting more immigrants, and reducing emigration. Lastly, the spillover effect of online advertising may not exist in the housing market. We discuss theoretical contributions and important implications to practitioners and policy makers.

Automated summary

This research investigates the impact of online advertising on the sales of new houses and identifies contingent factors and the underlying mechanism. The findings suggest that online advertising increases sales, especially in cities with lower housing prices, higher residential incomes, and lower-tier statuses. The mechanism is attributed to price reduction, immigrant attraction, and emigration reduction. Furthermore, it is found that there may not be a spillover effect in the housing market.