Assessing the Impact of Public Rental Housing on the Housing Prices in Proximity: Based on the Regional and Local Level of Price Prediction Models Using Long Short-Term Memory (LSTM)

Hyunsoo Kim, Youngwoo Kwon and Yeol Choi
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Hyunsoo Kim: Department of Urban Planning & Engineering, Pusan National University, Busan 46241, Korea
Youngwoo Kwon: Department of Urban Planning & Engineering, Pusan National University, Busan 46241, Korea
Yeol Choi: Department of Urban Planning & Engineering, Pusan National University, Busan 46241, Korea

Sustainability, 2020, vol. 12, issue 18, 1-25

Abstract: Providing adequate public rental housing (PRH) of a decent quality at a desirable location is a major challenge in many cities. Often, a prominent opponent of PRH development is its host community, driven by a belief that PRH depreciates nearby property values. While this is a persistent issue in many cities around the world, this study proposed a new approach to assessing the impact of PRH on nearby property value. This study utilized a machine learning technique called long short-term memory (LSTM) to construct a set of housing price prediction models based on 547,740 apartment transaction records from the city of Busan, South Korea. A set of apartment characteristics and proximity measures to PRH were included in the modeling process. Four geographic boundaries were analyzed: The entire region of Busan, all neighborhoods of PRH, the neighborhoods of PRH in the “favorable,” and the “less favorable” local housing market. The study produced accurate and reliable price predictions, which indicated that the proximity to PRH has a meaningful impact on nearby housing prices both at the city and the neighborhood level. The approach taken by the study can facilitate improved decision making for future PRH policies and programs.

Keywords: public rental housing; housing market analysis; price forecasting; long short-term memory (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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