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Many Beijing Siheyuan, a type of Chinese vernacular housing with significant cultural value, have been lost in recent years. Preserving the few remaining has become a necessity, but many contemporary architects lack an understanding of their design principles. Based on a historical analysis deriving from Fengshui theory, the Gongcheng Zuofa Zeli ancient construction manual, and craftsmen’s experience, this paper describes a parametric algorithm capable of producing Shiheyuan variants within a 4D CAD environment which by transforming the original design principles into an algorithm contributes to an understanding of Siheyuan typology and their preservation. This algorithm was implemented in a virtual scripting environment to generate accurate virtual counterparts of historical or extant Siheyuan houses revealing the tacit computational rules underlying traditional Chinese architecture.