Time Series Based House Sale Value Market Forecasting Using Genetically Evolved Neural Networks

Abstract

Accurate forecasting of the house sale value market is important for individual investors, business investors, banks and mortgage companies. This chapter uses fundamentals of Genetic Algorithms (GAs) and Artificial Neural Networks (ANNs) to derive and implement a hybrid, genetically evolved feedforward ANN model that predicts next month house sale prices. Derived model results are compared with results obtained using a linear regression model and an Adaptive Neuro Fuzzy Inference System (ANFIS). The proposed model returned lower Root Mean Square Error (RMSE), Absolute Mean Error (MAE), Mean Square Error (MSE) and Mean Absolute Percent Error (MAPE) results compared with the linear regression and ANFIS models. For case studies real monthly data of USA housing prices from 1963 to 2007 were used.