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Annals of Data Science

04-06-2024

Real Estate Market Prediction Using Deep Learning Models

Authors: Ramchandra Rimal, Binod Rimal, Hum Nath Bhandari, Nawa Raj Pokhrel, Keshab R. Dahal

Published in: Annals of Data Science

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Abstract

Real estate significantly contributes to the broader stock market and garners substantial attention from individual households to the overall country’s economy. Predicting real estate trends holds great importance for investors, policymakers, and stakeholders to make informed decisions. However, accurate forecasting remains challenging due to it’s complex, volatile, and nonlinear behavior. This study develops a unified computational framework for implementing state-of-the-art deep learning model architectures the long short-term memory (LSTM), the gated recurrent unit (GRU), the convolutional neural network (CNN), their variants, and hybridizations, to predict the next day’s closing price of the real estate index S &P500-60. We incorporate diverse data sources by integrating real estate-specific indicators on top of fundamental data, macroeconomic factors, and technical indicators, capturing multifaceted features. Several models with varying degrees of complexity are constructed using different architectures and configurations. Model performance is evaluated using standard regression metrics, and statistical analysis is employed for model selection and validation to ensure robustness. The experimental results illustrate that the base GRU model, followed by the bidirectional GRU model, offers a superior fit with high accuracy in predicting the closing price of the index. We additionally tested the constructed models on the Vanguard Real Estate Index Fund ETF and the Dow Jones U.S. Real Estate Index for robustness and obtained consistent outcomes. The proposed framework can easily be generalized to model sequential data in various other domains.

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Title: Real Estate Market Prediction Using Deep Learning Models
Authors: Ramchandra Rimal
Binod Rimal
Hum Nath Bhandari
Nawa Raj Pokhrel
Keshab R. Dahal
Publication date: 04-06-2024
Publisher: Springer Berlin Heidelberg
Published in: Annals of Data Science
Print ISSN: 2198-5804
Electronic ISSN: 2198-5812
DOI: https://doi.org/10.1007/s40745-024-00543-2

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