# The Impacts of Open Data and eXplainable AI on Real Estate Price Predictions in Smart Cities
## 4 Discussion
### Macroeconomic and Financial Indicators  
The SHAP plots in Figure 4 provide a general overview of the significance of macroeconomic and financial indicators, including inflation rate, unemployment, gross domestic product, and bank appraisal in the real estate price prediction model and their implications in the broader real estate market analysis context. The bank appraisal (BankEval), featuring a mean SHAP value of 8445.01, is highlighted as a top-10 predictor of property prices in the prediction model. This substantial value indicates that the financial sector's appraisals influence real estate market prices significantly. As an open data feature, BankEval adds a layer of transparency to the prediction process, offering a standard benchmark for market participants. The SHAP values for BankEval exhibit a wide range, with a notable red presence, which points to a general market trend where higher bank valuations are often in step with higher property market prices. The distribution of SHAP values for BankEval reveals a complex pattern: while there is a clear tendency for higher bank evaluations to elevate property prices, the model also recognizes numerous instances where this is not the case. These exceptions, some significant outliers, suggest scenarios where bank valuations may not align with the final sale prices, possibly due to unique property features, local market conditions, or divergences in evaluation methodologies. [PERSON] et al. 's (2023) ([PERSON] et al., 2023) research highlights the complex nature of appraisal errors, revealing how differences between appraised values and actual sale prices can arise due to market changes and valuation biases. This insight resonates with our findings, where BankEval is a significant but varied predictor. While bank appraisals typically reflect market trends, they are subject to inconsistencies. The Gross Domestic Product (GDP) shows a consistent positive impact, illustrating the connection between economic growth and real estate valuation. As GDP increases, signaling economic strength, there is typically an uptick in property prices due to heightened demand and investment capability. This trend reflects the fundamental role of economic health in shaping the real estate market's trajectory. The observed relationship in the model between property prices and the Consumer Price Index (CPI) supports the idea of real estate being an effective hedge against inflation. As CPI rises, indicating inflation, property values also tend to increase, suggesting that real estate can be a stable investment in times of currency devaluation. The unexpected positive SHAP values associated with the Unemployment Rate (UnempRate) warrant a nuanced interpretation. This effect could reflect a non-linear relationship or interactions with other variables that the model captures. For instance, these values may reflect specific economic contexts where real estate markets are resilient to unemployment, such as areas with a high proportion of non-working wealthy residents or strong social safety nets. The SHAP analysis reveals that macroeconomic and financial indicators correlate positively with property prices. Nevertheless, their effect can differ significantly across individual predictions, thus providing a valuable perspective on the predictive significance of macroeconomic and financial indicators within our model. While the general positive associations align with economic theory, the real-world implications of these findings should be contextualized within the broader economic landscape, considering the intricate interplay of local conditions, market sentiment, and economic policy. Following this line of reasoning, the discussion on property prices is enriched by integrating the findings from [PERSON] et al. (2019) ([PERSON] et al., 2019), [PERSON] et al. (2023) ([PERSON] et al., 2023), and the SHAP analysis, each contributing unique perspectives on the determinants of real estate valuation.