Property Values

How do we choose where we want to live and recreate? If you choose to live in New York, it may be that you love the energy of the city, the restaurants, the theatre. If you buy vacation property near Orlando, you probably value the sunshine, heat and proximity to Disney World. But what about the people who choose to own property in the Downeast Lakes region?

We don't have to hire concultants to conduct a survey to determine why people choose to live and play here. It's obvious. We place a very high value on:

• •  Being surrounded by nature.
• •  Enjoying wildlife.
• •  Being able to look to the horizon without seeing any reminders of man's presence.
• •  Seeing the Milky Way at night.
• •  Natural quiet.
• •  Clean water.
• •  Hunting, fishing, camping, hiking, etc.

In order to live in this area, we have all made sacrifices. Some things we want, we have to go without. And yet we stay, so strong is the attraction of being surrounded by mountains, wildlife, clear lakes and rivers. When we bought our homes, particularly waterfront homes or those that have long views, we paid a premium for these valuable features. And we continue to pay a premium through our property taxes.

Sadly, the day Maine's legislature "urgently approved" the recommendations of the Governor's Wind Energy Task Force, much of Maine was rezoned as pre-approved for industrial use. The Windustry wants to blast mountaintops, build highway-sized roads and punctuate the horizon with 400' to 500' tall industrial towers crowned with flashing red strobe lights. Can they tell us with any certainty that such a project won't hurt property values in a unique resource-driven community such as ours? No, they can't. There's no data to support the wind companies' claims about real estate values when large (over 50 mega watt) wind installations are built in areas where there is a mix of residential and rural land. The data they do have is on large tracts of land where there are few homes, and the homes that are near the turbines are participating financially in the project. That is not what the real estate industry would call "comparable".

Ask any objective real estate professional and he'll tell you that one of the most validated real estate principals is that natural views and scenery add to a property's value, and intrusions restricting those views reduce value. Professional appraisers know that even transmission lines detract from value. So doesn't it follow that the presence of an industrial wind power facility will as well?

All we have to go by is the experience of other property owners in more urban areas than ours. If industrial wind facilities harm their property values, it's reasonable to assume it will harm our at least as much and probably much more. Here's some of the evidence:

A 2009 study by Gardner Appraisal Group found declines ranging from 10% - 30% for properties within view of a wind complex.

In his June 10, 2005 direct testimony before the Wisconsin Public Service Commission, Kevin Zarem, a professional real estate appraiser, estimated that residential property near a proposed windplant “will likely be in the 17%-20% loss range.” He based this estimate solely upon visual impact. He did not assess potential loss due to wind turbine noise, motion, or shadows.

Russell Bounds, a Maryland realtor, testified in a Public Service Commission hearing that, over the last several years, he has had at least 25 people who expressed interest in buying property in a local area targeted by wind developers. However, when he advised them about the plans for wind facilities, not one of those people expressed further interest.

In September of 2009 Appraisal Group One of Wisconsin published a very thorough Wind Turbine Impact Study. Here's their conclusion:

"After reviewing articles and studies on wind energy, wind turbines appear to have a negative impact on the property values, health, and quality of life of residents in close proximity. Of the studies that found no impact on property value, nearly all were funded by wind farm developers or renewable energy advocacy groups. Of the studies and reports showing property loss, the average negative effect is -20.7%".

This very detailed report by McCann Appraisal does a fine job of explaining why wind projects DO have a negative financial impact on nearby property values.

Given the choice between buying a property with exquisite natural views and a comparable property surrounded by industrial development nearby, which one would you pay premium prices for?

The studies purchased and widely quoted by the Windustry present prices obtained in a select group of real estate transactions. That's completed transactions. But there's more to real estate than the price paid. Especially in the current economy time on the market is every bit as important as price received. It just stands to reason that when there are more sellers than buyers, time on the market increases and prices decline. But the Windustry ignores this fact. The following two pictures were taken on Route 6 in the area where First Wind hopes to build the Rollins Mountain project. It is obvious to anyone with a basic knowledge of economics that when you have this many properties available, the value of those properties is falling.

I'm not worried about my property's value.
I have no plans to sell anyway, so why should I care?

If you care at all about your community, you should care about property values. Property values drive property taxes which are a critical component of every town's budget. With more and more wind projects going up, towns are being besieged by local property owners who are challenging their assessments and filing for abatements. As evidence of devaluation mounts, towns are being forced to reassess properties downward or face costly class-action lawsuits.

In Ontario, Wolfe Island residents are seeing their property values decline and are filing for abatements. Read about it here.

On 4/7/10 Watertown Daily Times (NY) ran an article entitled Property values blowing in the wind. It describes the impact wind projects have had on property in the area. This is particularly relevant to the Bowers Project as it describes an economy that depends on tourism and homeowners who value their viewshed.