A globally ageing population is resulting in an increased prevalence of chronic conditions which affect older adults. Such conditions require long-term care and management to maximize quality of life, placing an increasing strain on healthcare resources. Intelligent environments such as smart homes facilitate long-term monitoring of activities in the home through the use of sensor technology. Access to sensor datasets is necessary for the development of novel activity monitoring and recognition approaches. Access to such datasets is limited due to issues such as sensor cost, availability and deployment time. The use of simulated environments and sensors may address these issues and facilitate the generation of comprehensive datasets. This paper provides a review of existing approaches for the generation of simulated smart home activity datasets, including model-based approaches and interactive approaches which implement virtual sensors, environments and avatars. The paper also provides recommendation for future work in intelligent environment simulation.