Research Team News, May 26, 2016

The Protect Sudbury Research team, led by Julie Lieberman, has been hard at work developing fact-based data that will be vital in our short and long term legal and political fight. This month, the Research team completed work on an in-depth analysis of the effect of the overhead power lines on property valuation and tax revenues. Loss percentage ranges were determined in accordance with the studies and information from eight national and local research reports. The Protect Sudbury study includes data from Sudbury, Hudson, Marlboro, Stow and Wayland. Through the use of the MassGIS Oliver data base, all properties within proximity of 3,000 feet from the rail ROW were studied. The study determined that the property de-valuation extends into four categories based on proximity to the property lines:

Direct Abutters (50 feet)
Adjacent Neighborhoods (300 feet)
Impacted Neighborhoods (1000 feet)
Outlying Neighborhoods (3000 feet)

The potential impact was examined on a ‘best and worst’ case basis. The illustration below shows a typical neighborhood and the projected impact across these four categories or ‘zones’.

research1

The total potential loss in property values for the town of Sudbury alone ranged from ~$20m to $63m dollars. Due to the resulting reduced assessments on these properties, annual tax revenues were projected to decline by about $400,000 to $1,000,000. The table below breaks down the total potential loss in property values for each zone under best and worst case scenarios.

table research

This data will be made available to residents at both our upcoming neighborhood meetings and through a tool that will be integrated into our web site. Individual property owners will be able to measure the impact on both their neighborhood as well as their own properties.

The Research Team also spent substantial time investigating potentially viable alternative routes for the Sudbury to Hudson power line that may not have been considered by ISO-New England or Eversource. This is a complex task that requires an in-depth understanding of transmission system planning, the existing grid, tariffs and rate assessments, and the existing infrastructure that exists on these potential routes. Despite these challenges, the team is confident that Protect Sudbury will be able to retain experts who can further develop and analyze these ideas.

Loss percentage ranges were determined in accordance with the following studies and information:
Steven C. Bottemiller, MAI, and Marvin L. Wolverton, PhD, MAI, The Price Effect of HVTLS on Abutting Homes, The Appraisal Journal (2013, Winter)

Portland Study Area Abutting homes impacted 1.65%
Seattle Study Area Abutting homes impacted 2.429%
Seattle Study Area Higher Priced Abutting homes impacted 11.225%

Charles J. Delaney and Douglas Timmons, “High Voltage Power Lines: Do They Affect Residential Property Value?” Journal of Real Estate Research 7,
no. 3 (Summer 1992): 315–329.

Proximity to power lines reduces home value by about 10%

Dean Chapman, “Transmission Lines and Industrial Property Value,” Right of Way (November/December 2005): 20–27.

Finds no basis for consequential damages to industrial properties based on proximity to HVTLs

James A. Chalmers, “High-Voltage Transmission Lines and Rural, Western Real Estate Values,” The Appraisal Journal (Winter 2012): 30–45.

Studied large agricultural production land and land with a recreational influence
Concludes that properties oriented toward resiential use are more vulnerable to (negative) HVTL price effect, larger properties are less vulnerable, and when a market provides more purchase alternative (subsitute properties) HVTL-impacted properties are more apt to experience a price effect.

Stanley W. Hamilton and Gregory M. Schwann, “Do High Voltage Electric Transmission Lines Affect Property Value?” Land Economics 71, no. 4 (November 1995): 436–444.

Analyzed 12,907 transactions from four neighborhoods in Vancouver, Canada from 1985-1991
Study found a 6.3% dimunition in value for homes in close proximity to power lines

Francois Des Rosiers, “Power Lines, Visual Encumbrance and House Values: A Microspatial Approach to Impact Measurement,” Journal of Real Estate Research 23, no. 3 (2002): 275–301.

Based on a sample of 507 single family houses sold in Montreal from 1991-1996.
Findings suggest that although severe visual ecumbrance due to a direct view on a pylon or conductors does exert a significantly negative impact on property prices with depreciations ranging from 5% to well in excess of 20%. Though, being adjacent to an easement will not necessarily cause a house to depreciate and amy even increase its value in similar proportions where proximity advantages exceed drawbacks.
Primary result was a 9.6% reduction in value for a home adjacent to a power line and facing a pylon.
Two court decisions by New York State’s Court of Appeal and the Court of Appeal of Kansas, Texas, have since stated that evidence of fear in the market place and ensuing economic damge to the property shoud be admissible as a ground for compensation, irrespecive of the reasonableness of the fear
Wherever negative impacts are at stake, these vary, by and large, between 1% and 6% of value at a 200 ft distance, 9% in the case of improvements to existing lines and between 6% and 9% of value at a distance of 50 feet. (Colwell and Foley, 1979: and Colwell, 1990).
Immediate proximity to, or direct view on, a pylon does cause house prices to drop, from 5% at a 50 meter, or 160 ft., distance to more than 27% at 10m., or 33 ft. (Callanan and Hargreaves, 1995; and Hamilton and Schwann, 1995)
Owners of luxury houses tend to be more sensitive than other to the potential visual encumbrance
Proximity of 165-500 feet leed to drops of 4.1% to 5.3% in 165-325 feet range, in eastern study 165 feet = 8.4% depreciation and 12% for properties within 325 to 500 feet,
Overall, price reduction stands at roughly 10% of mean house value, but averages 15% in study area where setback from powerline is 50 ft. While properties belonging to lower end of the market experience price reductions in the 10% to 15% range, findings also suggest prices drops of around 15% – 20% for upper price properties. In one neighborhood dpreciation reaches 23%. Similarly, a direct view of conuctors will usually reduce property values by 5% – 10%; in some cases though, the market discount exceeds 15%.
Property premiums of 7% to 22% were found when proximity advantages (enlarged visual field, increased intimacy) exceed drawbacks
Negative impacts decrease rapidly after 500 ft.

Robert A. Simons and Jesse D. Saginor, A Meta-Analysis of the Effect of Environmental Contamination and Positive Amenities on Residential Real Estate Values, The Journal of Real Estate Research; Jan-March 2006; 28, 1; ProQuest Central p. 71

For the 164 observations that utilize regression analysis, the largest loss was $42,480 and the mean loss was $6,443. These values correspond to a percentage loss in value of 29% for the largest loss and a mean loss of 4%
Case studies, while often highlighting worst-case scenarios and often only one hamoe, had losses ranging from 0 to $438,200 (88%) of home value, with a mean of 21%.
Survey methods also had larger losses in terms of percent. The maximum loss was $96,669 (94%) with a mean loss of $17,164 (19%).

Study Conducted by Libby Hamill, Sales Associate, Stephan Real Estate, 400 Boston Post Road, Sudbury, MA, 01776; L.Hamill@StephanRE.com; 978-443-7300

Spoke to the Assessor in town and she said that houses that have a power utility easement have a 15% standard reduction the land value of the property.
The Assessor also stated that their formulas are market driven.
There are approximately 30 homes that are affected by transmission lines from Wayland. The market history is very limited: A consumers adverse perception of price could lower market value by 10% to 30% or more.
35 Stonebrook has been lowered 3 times values has decreased by 14% and not sold yet.
23 Millbrook lost approx 35% – 38% of vaue between 2008 and 2010