Can Google Trends Actually Improve Housing Market Forecasts?

Abstract

We augment linear pricing models for the housing market commonly used in the literature with google trends data in order to assess whether or not crowd-sourced search query data can improve the forecasting ability of the models. We compare various performance measures of the augmented linear model's out-of-sample, one-step ahead, dynamic forecasts against a baseline version. We find that augmenting the models to take advantage of the availability of Google trend data does not improve the forecasting performance of the models.