A Word to the Wise Analyzing the Impact of Textual Strategies in Determining House Pricing

Some of the mechanisms through which house prices are determined to remain unclear. This work aims to shed some light on the subject by analyzing the impact of text structure and given keywords in the announcements of house sales over the internet. It seems that, especially in trade among private individuals, the marketing of the announcement can make the difference. By retrieving data regarding houses on sale in Italy, one of the countries in which the housing market is still overwhelmingly composed of deals between private individuals (and not a market shared by a few big companies), we derived via OLS and fractional response probit estimation the impact of the text structure and several keywords. Our results show that there is no mark-up due to verbs and punctuation, or transport- and tourism-related keywords, while an abundance of nouns and adjectives or keywords related to investment, panorama, and cultural heritage have a positive (or expected) impact on the price. This suggests that using many nouns and adjectives in writing a house sale announcement helps to sell the property at a higher price, and also that while the latter set of keywords play a role in determining house prices, announcements leveraging transport opportunities and touristic opportunities do not.

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