Performance evaluation of housing price index prediction model using DNN and SVR

This study used the base interest rate, mortgage interest rate, deposit interest rate, consumer price index, exchange rate, and composite stock price index as variables to predict the housing price index. The variables were normalized using the min-max normalization method. Machine learning methods, Deep Neural Networks (DNN) and Support Vector Regression (SVR), were employed to construct a prediction model, and the fit of the model was evaluated using the Root Mean Square Error (RMSE). The analysis results of the DNN model indicated that when applying the softplus activation function, the RMSE was 0.1298, resulting in the smallest prediction error, and the correlation coefficient between the predicted and actual values was highest at 0.9342. The analysis results of the SVR model using the Gaussian RBF kernel showed that the RMSE was smallest at 0.2781 when the parameters were set to C=100 and Gamma=0.1. Therefore, the DNN model was found to be more fit for predicting the housing price index. Additionally, it was confirmed that the consumer price index had a non-linear effect with a positive relationship, and the base interest rate had a linear effect with a negative relationship.

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Journal
Edelweiss Applied Science and Technology
Published
2024-09-21
DOI
https://doi.org/10.55214/25768484.v8i5.1881
Primary Topic
Technology and Data Analysis
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article
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article

Performance evaluation of housing price index prediction model using DNN and SVR

Chang‐Ho An
Edelweiss Applied Science and Technology
Technology and Data Analysis
article

Performance evaluation of housing price index prediction model using DNN and SVR

Chang‐Ho An
article en

Abstract

This study used the base interest rate, mortgage interest rate, deposit interest rate, consumer price index, exchange rate, and composite stock price index as variables to predict the housing price index. The variables were normalized using the min-max normalization method. Machine learning methods, Deep Neural Networks (DNN) and Support Vector Regression (SVR), were employed to construct a prediction model, and the fit of the model was evaluated using the Root Mean Square Error (RMSE). The analysis results of the DNN model indicated that when applying the softplus activation function, the RMSE was 0.1298, resulting in the smallest prediction error, and the correlation coefficient between the predicted and actual values was highest at 0.9342. The analysis results of the SVR model using the Gaussian RBF kernel showed that the RMSE was smallest at 0.2781 when the parameters were set to C=100 and Gamma=0.1. Therefore, the DNN model was found to be more fit for predicting the housing price index. Additionally, it was confirmed that the consumer price index had a non-linear effect with a positive relationship, and the base interest rate had a linear effect with a negative relationship.

Edelweiss Applied Science and TechnologyVol. 8(5)
Seokyeong University (KR)
Openalex Percentile: Top 75%
Technology and Data Analysis
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