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Housing Value Forecasting Based on Machine Learning Methods

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  • Jingyi Mu
  • Fang Wu
  • Aihua Zhang

Abstract

In the era of big data, many urgent issues to tackle in all walks of life all can be solved via big data technique. Compared with the Internet, economy, industry, and aerospace fields, the application of big data in the area of architecture is relatively few. In this paper, on the basis of the actual data, the values of Boston suburb houses are forecast by several machine learning methods. According to the predictions, the government and developers can make decisions about whether developing the real estate on corresponding regions or not. In this paper, support vector machine (SVM), least squares support vector machine (LSSVM), and partial least squares (PLS) methods are used to forecast the home values. And these algorithms are compared according to the predicted results. Experiment shows that although the data set exists serious nonlinearity, the experiment result also show SVM and LSSVM methods are superior to PLS on dealing with the problem of nonlinearity. The global optimal solution can be found and best forecasting effect can be achieved by SVM because of solving a quadratic programming problem. In this paper, the different computation efficiencies of the algorithms are compared according to the computing times of relevant algorithms.

Suggested Citation

  • Jingyi Mu & Fang Wu & Aihua Zhang, 2014. "Housing Value Forecasting Based on Machine Learning Methods," Abstract and Applied Analysis, John Wiley & Sons, vol. 2014(1).
  • Handle: RePEc:wly:jnlaaa:v:2014:y:2014:i:1:n:648047
    DOI: 10.1155/2014/648047
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    References listed on IDEAS

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    3. Malpezzi, Stephen, 1999. "A Simple Error Correction Model of House Prices," Journal of Housing Economics, Elsevier, vol. 8(1), pages 27-62, March.
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