Building renewable energy plants could help increase the value of nearby property prices, according to a new report.
According to PRD’s, Renewable Energy In the Property Market, local government areas that built either a wind or solar energy plant in 2017, have seen average property prices increase 6.5 per cent, 7.8 per cent, and 41 per cent over the past one, two, and five years.
The report said that while residing within 100 metres of a renewable energy plant may not be ideal, the surrounding LGA benefits through the drop in energy prices.
“While the fiscal growth solely from proximal plants is small (3 per cent across the property’s lifespan), it can significantly raise a region’s property value,” the report said.
“Property values rise due to the increased demand created in the area.
“The value of a home may also increase with the installation of solar panels.”
According to the report, since 2017 Broken Hill has seen the value of property rise 43.8 per cent, Upper Lachlan in Victoria has seen an increase of 51 per cent, while Colac Otway Shire has had an increase of 44.9 per cent.
The report found that having a renewable energy plant can also help attract people to the area.
“The introduction of renewable energy can significantly help a region draw in new residents,” the report said.
“This is largely because rising inflation and economic growth have increased living expenses, making any decrease in expenses—especially power—a significant deciding factor when choosing where to buy real estate.”
There have also been international locations that have seen similar benefits from renewable energy projects, including California, Philippines and Germany.
The report said the three locations all saw reduced electricity costs, re-direction of state and national budgets to other aspects of the economy, availability of better quality electricity, and a more vibrant local economy due to interstate and/or international migration to the area.
“This flows to the housing sector as the areas become more liveable, perpetuating forecasted higher house prices,” the report said.
Despite interest in renewable energy, the report found there was no planning put in place for residential development.
Only 60 new residential developments have been approved in Moyne and Cabonne LGAs since 2017, the report said.
“This, however, also depends on the adaptability of the regional planning authorities, both at the State and Local Council levels, to permit the growth of new housing supply at a rate that is consistent with demand.”
Should the current rate of property growth continue, property prices could continue to increase in locations with renewable energy plants.
