Lots located next to power lines tend to sell for a whopping 45 percent less than similar lots further away from high-voltage transmission lines, according to a new study in the Journal of Real Estate Research. Lots that are non-adjacent to power lines but are located within 1,000 feet of them often sell at a discount of 18 percent, researchers Chris Mothorpe and David Wyman, the authors of the study, found.
The study focused on the value of vacant land, eliminating other factors that could also influence price, such as home style and square footage. The researchers say land typically represents 20 percent of a home’s overall value. Therefore, the 45 percent decrease in land value would translate to a drop in total property value of around 9 percent, according to the study.
Mothorpe and Wyman, assistant professors at the College of Charleston in Charleston, S.C., culled sales data from 5,455 vacant lots sold between 2000 and 2016 in Pickens County, S.C. A network of high-voltage electrical lines are located in Pickens County from the Oconee Nuclear Station.
Mothorpe says health concerns about being near high-voltage lines are one of the factors likely driving down prices of nearby land. But a solid link between power lines and health issues remains elusive, he adds. Unattractive views of power lines also affects land prices, Mothorpe says, and residents who live near them may hear a humming sound produced by the lines. “My intuition tells me the visual [component] is the largest” factor leading to a decrease in values, Mothorpe told The Wall Street Journal.
Source:
“The Electrifying Factor Affecting Your Property’s Value,” The Wall Street Journal (Aug. 15, 2018) [Log-in required.]
