The effect of large-scale solar farms on nearby property values is the subject of a new report by researchers at Virginia Tech, published in the Proceedings of the National Academy of Sciences.
Some 8.8 million real estate sales across the United States were examined as part of the study, which was undertaken by Virginia Tech’s Department of Agricultural and Applied Economics in the College of Agriculture and Life Sciences.
As the study noted, the ‘stigma’ that solar panels are visually unappealing and will have a negative effect on the property value of nearby land has been around since the 1970s.
But do such concerns linger today? According to the study, ‘it’s complicated’.
Concerns over property value
“As the US scales up renewable energy, solar installations are increasingly being sited near homes and on farmland, and this often leads to pushback from residents worried about aesthetics or property value loss,” said Chenyang Hu, a graduate research assistant in the Department of Agricultural and Applied Economics and the paper’s lead author. “Until now, much of this discussion has been based on anecdotal evidence.”
The research team, led by Zhenshan Chen, assistant professor in Virginia Tech’s Department of Agricultural and Applied Economics, identified 3,699 commercial solar photovoltaic sites nationwide. They assessed the property values of surrounding homes, farmland, and vacant parcels from 15 years before the construction of the solar installations through to 2020.
Using a bespoke econometric model, the team then estimated changes in property values relative to their distance from solar arrays while accounting for trends over time and regional differences.
A mixed outcome
The study yielded a somewhat mixed outcome, with agricultural and vacant land located within two miles of a solar farm experiencing an average value increase of 19.4%, potentially driven by the perceived potential of these properties for future solar leasing.
At the same, time, residential properties within three miles of a solar site showed a 4.8% average decrease in value. These declines were less evident for properties located further away from the site, as well as for properties with more than five acres of land.
“The negative residential impacts appear to stem more from perception or a stigma effect than from any physical harm,” Hu added. “Interestingly, these effects are much smaller or even reversed entirely in counties that are politically left-leaning.” Read more here.
