Skip to main content

Simulating Temporal Fluctuations of Real Estate Development in a Cellular Automata City

Buy Article:

$43.00 plus tax (Refund Policy)

This research aims to understand the source of temporal fluctuations in real estate development through simulating a cellular automata model. In this cellular automata city, investment decisions are made according to the profitability measured in a local neighbourhood. If developers think there is enough of a profit margin in a particular site, i.e. a ‘niche’ of investment, they will increase investment at that site. However, by increasing investment at the site, new ‘niches’ might be created. Therefore, the action of converging towards an equilibrium state itself paves the way towards new fluctuations. This model demonstrates the potential of using simulation to increase our understanding of real estate dynamics. The experiments suggest that locally made ‘rational’ decisions can lead to temporal fluctuations because of non–linearity (discrete changes/densification and local bounded information). Interestingly, the fluctuations may show the property of a temporal fractal. This requires a sufficiently sensitive process of ‘niche’ formation compared with a relatively large impact of additional investment. The simulation suggests that the impact should be 4 to 20 times higher than the threshold over which a niche will be formed. This condition is satisfied in most cases of real estate investment, thus suggesting a self–organised criticality in complex real estate development.
No References
No Citations
No Supplementary Data
No Data/Media
No Metrics

Document Type: Research Article

Affiliations: University of Southampton [email protected]

Publication date: 2003-03-01

  • Access Key
  • Free content
  • Partial Free content
  • New content
  • Open access content
  • Partial Open access content
  • Subscribed content
  • Partial Subscribed content
  • Free trial content
Cookie Policy
Cookie Policy
Ingenta Connect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more