With any luck at all, you got yourself outside this past weekend and enjoyed not just the spectacular string of perfect weather we had, but some of the best foliage we have witnessed in many years. I was biking, hiking and fishing across northern New Hampshire on Sunday and Monday, and found myself stopping to “smell the roses” on frequent occasions. During one of these pauses, it occurred to me that “these” are the views that people talk about. These are the scenes that are captured on countless cameras. These are a few of the many reasons we love to live here.
As I was enjoying the surroundings and the warm weather, I couldn’t help but think about how this intangible and ethereal feeling we get, when overcome with that sense of wonderment, has a direct impact on the value of our properties. There is no question the “view tax” created quite a stir when it found its way to the New Hampshire legislature. But is there more to it, than just a tax on a scenic view from your front porch?
In 2001 Michael Bond and Vicky and Michael Seiler researched the impact that a view of Lake Erie has on the value of a home. The study used “transaction-based” prices instead of “appraisal-based” so the numbers are derived directly from what someone actually paid for the property, not on the educated speculation of an appraiser, assessor or broker. What they found was while square footage and lot size had significant impacts on a home’s value, having the view of Lake Erie adds $256,544.72 (an 89 percen premium) to the value of the home. And that was 15 years ago. These people take that “location” thing very seriously!
The location of your home is without question the most vital piece of the value puzzle. As we all know, they are not producing any more land. And as our population continues to swell, the demand for land will continue to rise. Unless something happens to directly impact the demand for a given area, the land can be expected to increase in value over time. The opposite is true of the structure that sits on the land. It can be said that if left alone, a structure will continue to lose value until it no longer adds value to the parcel it sits on.
What about external factors beyond our control? Future developments can certainly impact your value in either direction. Wind farms and power lines are never-ending points of contention both in the town hall meetings and in the media. In a study done in 2009 by James Chalmers for The Appraisal Journal, the presence of transmission lines did not show any consistent, material effect on property values. In fact, in most of the reading I did about nuclear power plants and their associated “disasters,” the impact of these plants or events diminished within two or three years, and property values stabilized.
On the flip side of that, the addition of a school or even a town office can do wonders for the value of your home. And little things like your location within a neighborhood and the proximity to more expensive or less expensive homes will impact both the perceived value and the sale-ability of your home.
I live within “earshot” of a state highway. Is that going to impact my home’s value? I’m sure it will. But I also enjoy a panoramic view of multiple 4000-foot peaks in the White Mountains. It is safe to say, I’m banking on the latter countering the former! I think one of the biggest concerns many people have with the addition or extension of power lines is the impact it will have on the “view.”
When you are on Main Street in Lincoln, on the other side of the Kanc, you will look up to the mountains and see a string of steel cables cutting through the landscape where today you only see trees. While that may not directly impact the value of one’s home, that is still a large part of the intangible value I was talking about.
“At the end of the day, it is important to look at your home as an investment. Chances are, this is one of the biggest chunks of money you will have placed in a single “basket” in your life, notes Badger Realty agent, Jerry Hamanne.
If you can focus on the land, the surroundings and the potential, you will be more likely to see the true value of the entire property and how those external factors affect you. With any luck at all, we will continue to enjoy experiences like we did last weekend, that make living in the White Mountains of New Hampshire, worth every penny!