Property Values Summary

The issue of wind turbines and their effect upon nearby property values has long been a contentious one, and for good reason.  We generally accept the “wisdom of the market”, and if wind turbines are as disruptive as opponents claim, surely this would show up in market prices of nearby properties.  Opponents, politicians and wind developers can make all sorts of statements about noise, flicker, birds and so on, but talk is cheap.  House prices, on the other hand, can be quite dear, and there’s no easy or cheap way to hide the effect of wind turbines on house prices if in fact there is an effect.  Plus house prices can serve as a single and quantitative proxy for all the effects that wind turbines may have on the neighbors.

Given the long history of the real estate industry figuring out house prices (commonly called “comps”) you’d think this issue would be easily settled.  Unfortunately, it is possible to arrange the data in these studies to suit the sponsor – as Mark Twain famously observed, “figures don’t lie, but liars figure”.  But couldn’t one just take the prices of houses sold “in the area” before and after a project went in?  But how big should “the area” be?  And if there’s only a small number of sales – these are, after all, generally remote areas – what conclusions can you draw?

For the wind industry and its allies in government and academic circles, persuasive studies showing no effect would go a long way to quiet the protests of the neighbors and make wind projects easier, quicker and cheaper to install.  Almost needless to say, they have been working on such studies for a number of years.

These studies reveal the underlying argument the wind industry uses to try to convince the willing and the gullible.  They justify a large study area by asserting the main problem with turbines was how they look.  So if you could just see them (and you can see them for miles) they ought to affect the prices and since there was no measurable effect on prices there must be no problems whatever with the turbines.  Nice logic, if you can convince someone to accept it, and many politicians and reporters have done so.

This theme of the people objecting to wind projects mainly because of how they look is mentioned prominently in wind industry literature as the main reason people object to them.  Never mind the noise, flicker, sleep problems and so on that are much more important for the actual close-in neighbors.  The only place where serious visual objections are raised is where the scenery has a special value, like shorelines.  Unfortunately, no property value study has ever been done specifically on projects in high-scenic-value locations.  There’s just not enough data yet – for example in Hoen’s study only 117 properties out of some 7500, or 2%, had “premium vistas”.

Regardless of what the wind industry asserts, the serious concerns for property values come from people who think they might be able to hear or feel the turbines enough so they cannot escape the noise and vibration even when they are just trying to enjoy their property, and especially when they are trying to go to sleep.  For a home affected by this sort of problem the reduction in value might be very large indeed, certainly into double digits and in the worst cases approaching 100%.  This is what home owners really fear.  These are typically rural residents, often relatively poor, and their home represents a major part of their assets.  To lose a substantial part (or even all) of its value is a real life-changing event.  If wind energy is that important, then certainly the powers-that-be can come up with the relatively small amounts of money it would take to buy the neighbors out, saving them from bearing the very high costs of living amid an industrial project that they didn’t ask for, don’t want, and don’t benefit from.

7 thoughts on “Property Values Summary”

  1. One other aspect of property values might be this: A person buys a country property for $500,000. They get a mortgage for, say, $450,000. Wind farm project comes in. Property value drops 15%. This person’s equity in the house is wiped out, and they have an “underwater” mortgage, to use the mortgage market term. In other words, they are now making payments on a loan which is worth less than the asset. It would not be the first time that people have packed up and abandoned their house in similar circumstances–in other words, let the bank take it. Meanwhile, the farmer next door picks up a tidy $20,000 for signing up with the wind farm.

    Does that seem fair?

  2. Awaiting moderation? Bahaha… what a joke. Impossible to have a conversation about this (or any) issue when you can censor the widespread public’s opinion.

  3. Hi Bud, the moderation is due to spam. If a comment is germane to wind turbines I approve it, regardless of whether it is critical or supportive.

    As you say, the property values issue does apply to relatively few people. Then it shouldn’t cost the rest of us very much extra to make sure these few people are made whole. If you are willing to sacrifice them, then I assume you’d have no complaint when its your turn to be sacrificed.

  4. Any chance of digging out the case citation quoted by Parker 6 months ago? That link doesn’t work. About a year ago there was an MPAC appeal on Wolfe Island in Canada and the appeal determined no impact on value – I think this is likely wrong.

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