Rent index forecasting through neural networks

Xiaojie Xu and Yun Zhang

Journal of Economic Studies, 2021, vol. 49, issue 8, 1321-1339

Abstract: Purpose - Chinese housing market has been growing fast during the past decade, and price-related forecasting has turned to be an important issue to various market participants, including the people, investors and policy makers. Here, the authors approach this issue by researching neural networks for rent index forecasting from 10 major cities for March 2012 to May 2020. The authors aim at building simple and accurate neural networks to contribute to pure technical forecasting of the Chinese rental housing market. Design/methodology/approach - To facilitate the analysis, the authors examine different model settings over the algorithm, delay, hidden neuron and data spitting ratio. Findings - The authors reach a rather simple neural network with six delays and two hidden neurons, which leads to stable performance of 1.4% average relative root mean square error across the ten cities for the training, validation and testing phases. Originality/value - The results might be used on a standalone basis or combined with fundamental forecasting to form perspectives of rent price trends and conduct policy analysis.

Keywords: Rental housing market; Rent price; Neural network; Forecasting (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:jespps:jes-06-2021-0316

DOI: 10.1108/JES-06-2021-0316

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