Stellax has received a new time model
How long will it take to rent a property out?
What do the Boston Marathon and the Dutch rental market have in common?
The Boston Marathon finish time and time looking for a tenant (Time) are not normally distributed (histograms below). The left tail is truncated and accompanied by the heavy right tail.
I find modelling it very interesting. As of today the Time estimate in Stellax report is done via the updated model. The 2nd picture presents the diagnostic plots when homoscedasticity and normality for Time are assumed. The left plot exhibits a clear presence of heteroscedasticity, while the quantile residuals hint at the distribution misspecification.
One way to tackle such behaviour is by a) specifying an appropriate distribution and b) modelling variance as a function of explanotary variables.
After trying various distributions, it seems that the Gamma distribution fits the data well and have one of the lowest GAICs.
The 3rd picture illustrates the Gammas PDFs with the variance modelled as a function of property size
The 4th picture shows that both diagnostic plots now look much better. The overall model’s GAIC has improved significantly as well (>10%).
Soon updated models for Rent, Price and a revamped Report page!
Keep modelling! 🙂