How does wind turbine construction affect property prices? Within 1,000 metres, they may fall by up to 7.1%

According to a study by the German RWI institute (Leibniz Institut für Wirtschaftsforschung), which examined property prices near wind power plants, the construction of a wind power plant 1 km from a house can be expected to reduce its price by around 7.1%. According to the study, the negative effect on house prices disappears completely only at a distance of around 8 kilometres from a wind power plant.

Wind power plants have a number of positive effects, but their negative impacts should not be overlooked. According to the latest surveys, Germany’s residents pay the highest price for electricity consumption, with regulated charges, particularly charges associated with supporting electricity generation from renewable sources, being the main reason for high prices.

Besides higher electricity prices, the construction of wind power plants has another, less expected effect on residents’ assets. A study by the German RWI institute, based on a sample of almost 3 million listings for houses and flats from 2007 to 2015, concluded that property prices fall significantly when a wind power plant is built near a property. Based on the data analysed, the study concluded that the decline amounts to as much as 7.1% when the turbine is 1 km away.

According to the study, the main reasons for the price decline are noise and the visual impact of the structure on the surrounding landscape. The effect disappears completely only at a distance of around 8-9 km, when any impact on property prices is within the margin of statistical error.

The average distance of a property from the nearest wind turbine in Germany is 8.4 km, with around 9% of properties located less than 2 kilometres away. Only 0.6% of homes have their nearest wind turbine more than 30 km away.

The study’s results further show, as expected, that the construction of wind power plants has the greatest impact on property prices in sparsely populated rural areas, with the effect being stronger for older homes. Prices of older homes built before 1949 and located in rural areas may be reduced by as much as 23% as a result of wind power plant construction. By contrast, homes in urban areas are almost entirely unaffected by such construction.

According to numerous studies conducted on this topic, no unambiguous conclusions can be drawn. The study itself points out that research using a different calculation method or conducted in other locations may reach different conclusions. Examples include several studies based on data from the United States, which found no negative effect of wind turbine construction on property prices.

Conversely, research based on European data tends to show a negative effect from construction. Research processing data on Dutch properties found that the price of an average Dutch property falls by around 1.4% if a wind turbine is built within two kilometres. In the United Kingdom, a price reduction of as much as 6% can be expected if construction takes place within a two-kilometre radius of a property.

The full study in English is available here.