High voltage towers and property value

Would it bother you to live next to a high voltage tower? I snapped these photos recently while in a neighborhood in the Sacramento area. You can see these towers are very close to the houses (within 100 feet easily in some cases). While someone selling the property might be tempted to say the house “backs to open space”, the view is clearly obstructed and dominated by the presence of the tower, so any “open space” premium is likely watered-down a bit, right? In appraisal terminology, we’re dealing with external obsolescence, which is a reduction in value caused by an undesirable factor outside the property.

How have you seen buyers respond to a location near a power tower? What do you think is the main turn-off in the minds of buyers? Visual pollution or a potential for health risks due to electromagnetic fields?

Photo of high voltage tower by Sacramento Appraiser

Photo of high voltage tower by Sacramento Appraiser

Photo of high voltage tower by Sacramento Appraiser

Photo of high voltage tower by Sacramento Appraiser

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Comments

  1. says

    While not directly in the back yard, the PG&E towers creates and easement which gives us a little larger lot size. Once the trees and landscaping mature, they are barely noticed. Now let’s talk about my neighbor and his RV parked in the driveay year round…..

    • says

      There you go, Kevin. Great point about the larger lot size from the easement and mature trees. You nailed it. I’m glad for you to have that. I appraised one in the Treelake neighborhood in Granite Bay (many towers there) and the view was fantastic (but there was also a tower fairly close by too). A stellar view or positive feature can certainly help to offset some of the stigma of a tower nearby though. Good luck on that RV. 🙂

  2. says

    Ryan~When I first started selling new construction homes years ago, one of my first developments had some unsold lots backing up to HV lines-guess where my model home went. I would swear that after sitting in my model all day long I would glow in the dark.

    Here’s a link to an article I just did on how to deal with high voltage power lines within an appraisal. I hope everyone finds it useful. Thanks for letting share Ryan!

    http://proevalue.com/fha-appraisals-and-high-voltage-power-lines.htm

    • says

      I was wondering what that glow was in your profile pic. I wasn’t going to say anything, but now that you mention it… Thanks for the comment and for the excellent link. If anyone is here looking for specific FHA guidelines regarding high voltage towers, make sure to check out Michael’s post.

  3. Mark says

    Hey Ryan,

    I am seeing a bit of bias or assumption that this surely is an adverse situation (stigma) to live near a high power line. That may be true in your market and typically it is in my market, too; However, studies on this have not been so conclusive. I suggest that appraisers read this study and test THEIR market and verify if indeed there is any external obsolescence. http://www.real-analytics.com/TAJFall07p.323-325.pdf

    Thanks and keep up the good work.

    • says

      Hi Mark. Thank you for the comment and article. I’ll check it out when I have a moment. I find there usually is a price difference when a house is located next to a HVT. Of course I think you bring up an important reminder to not assume. On top of that though, it really depends on the location of the tower. Are we talking about literally right next to the backyard? Or is it off in the distance? These things matter. There is no one end-all statement to give a conclusion to every situation. That’s for sure. Thank you.

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