The repeat sales model is commonly used to construct reliable house price indices in absence of individual characteristics of the real estate. Several adaptations of the original model are proposed in literature. They all have in common using a dummy variable approach for measuring price...

State space models with nonstationary processes and fixed regression effects require a state vector with diffuse initial conditions. Different likelihood functions can be adopted for the estimation of parameters in time series models with diffuse initial conditions. In this paper we consider...