The Impact of Wind Power Projects on Residential Property Values ...

with the scenic vista. In other words, the sales price increases when views <strong>of</strong> turbines overlap
the prominent scenic vista, at least in the BARELY category. A more likely explanation for
these results are that the relatively high correlation (0.68) between the VIEW and OVERLAP
parameters is spuriously driving one set <strong>of</strong> parameters up and the other down. More importantly,
when the parameters are combined, they <strong>of</strong>fer a similar result as was found in the Base Model.
<strong>The</strong>refore, it seems that the degree to which the view <strong>of</strong> turbines overlaps the scenic vista has a
negligible effect on sales prices among the sample <strong>of</strong> sales transactions analyzed here. 90
Despite these somewhat peculiar results, other than MINOR, none <strong>of</strong> the VIEW categories are
found to have statistically significant impacts, even after accounting for the degree to which
those views overlap the scenic vista. Similarly, none <strong>of</strong> the OVERLAP variables are
simultaneously negative and statistically significant. This implies, once again, that a Scenic
Vista Stigma is unlikely to be present in the sample. Additionally, none <strong>of</strong> the DISTANCE
coefficients are statistically significant, and those coefficients remain largely unchanged from the
Base Model, reaffirming previous results in which no significant evidence <strong>of</strong> either an Area or a
Nuisance Stigma was found.
90 An alternative approach to this model was also considered, one that includes an interaction term between VIEW
and VISTA. For this model it is assumed that homes with higher rated scenic vistas might have higher rated views
<strong>of</strong> turbines, and that these views <strong>of</strong> turbines would decrease the values <strong>of</strong> the scenic vista. To construct the
interaction, VISTA, which can be between one and five (e.g., POOR=1,…PREMIUM=5), was multiplied by VIEW,
which can be between zero and four (e.g. NO VIEW=0, MINOR=1,…EXTREME=4). <strong>The</strong> resulting interaction
(VIEW*VISTA) therefore was between zero and sixteen (there were no PREMIUM VISTA homes with an
EXTREME VIEW), with zero representing homes without a view <strong>of</strong> the turbines, one representing homes with a
POOR VISTA and a MINOR VIEW, and sixteen representing homes with either a PREMIUM VISTA and a
SUBSTANTIAL VIEW or an ABOVE AVERAGE VISTA and an EXTREME VIEW. <strong>The</strong> interaction term, when
included in the model, was relatively small (-0.013) and weakly significant (p value 0.10 – not White’s corrected).
<strong>The</strong> VISTA estimates were unchanged and the VIEW parameters were considerably larger and positive. For
instance, EXTREME was 2% in the Base Model and 16% in this “interaction” model. Similarly, SUBSTANTIAL
was -1% in the Base Model and 13% in this model. <strong>The</strong>refore, although the interaction term is negative and weakly
significant, the resulting VIEW estimates, to which it would need to be added, fully <strong>of</strong>fset this negative effect.
<strong>The</strong>se results support the idea that the degree to which a VIEW overlaps VISTA has a likely negligible effect on
sales prices, while also confirming that there is a high correlation between the interaction term and VIEW variables.
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