When the news talks more about a state’s housing market, prices in that state tend to rise faster in the months that follow. A study of all 50 US states finds that media attention predicts house price growth better than mortgage rates, income or employment.
The paper is by Oguzhan Cepni of Copenhagen Business School and Ostim Technical University. It was published online in Real Estate Economics on September 22, 2025, in the January 2026 issue.
Counting housing stories, state by state
Cepni built his measure from the Bloomberg Terminal’s News Trends function, which tracks news stories and social media posts from more than 150,000 sources and uses AI tools to tag what each one is about.
For each state, he counted every story or post about its housing market, wherever it was published. A statistical method called partial least squares then combined those counts into a housing media attention index for each state, plus one for the country as a whole.
He argues that housing is a good place to test whether news moves prices. Unlike stocks, homes are costly to buy and sell, hard to search for and very hard to bet against, so mispricing is not quickly corrected by professional traders.
A stronger signal than the usual suspects
In the main regressions, the state index explained a large share of future price changes, with an adjusted R-squared of 0.29. That was well above the explanatory power of mortgage rates, income, employment and other economic activity measures.
A one standard deviation increase in housing attention in one quarter was followed, on average, by a 0.37% increase in house price growth the next quarter. National coverage also mattered and helps explain why booms and busts often hit many states at once, but state coverage kept its predictive power even after controlling for it, and it did better in out-of-sample forecasts.
The link held when Cepni used the timing of routine Federal Reserve meetings, which draw housing coverage without changing fundamentals, as an instrument for media attention. It also survived controls for a survey of consumer housing sentiment and appeared at the city level.
Where news hits hardest
The effect was larger in some places than others. In states with non-recourse mortgage laws, where lenders cannot pursue borrowers beyond the house, a one standard deviation rise in attention added a further 0.13% to price growth a quarter ahead.
In states with heavier land-use regulation, the predicted price rise was twice as large as in less regulated states. In states with more Facebook friendship ties, it was 0.15% larger, and it was also stronger where low- and high-income people were more often friends.
Cepni suggests regulators could treat a spike in the index as an early warning of overheating, especially in tightly regulated markets where supply cannot respond quickly to a burst of upbeat coverage.
Study Details:
- Title: News media coverage and the predictability of house prices
- Authors: Oguzhan Cepni
- Journal: Real Estate Economics
- Publication Date: September 22, 2025
- DOI: 10.1111/1540-6229.70008