New study looks at benefits of Whitefish, Flathead lakes on property values
KALISPELL, Mont. — Recently the Flathead Lake Biological Station and Whitefish Lake Institute worked together to estimate the benefits of Whitefish Lake and Flathead Lake, specifically looking at home values in the form of price premiums for lakefront and nearby real estate.
Officials at the FLBS said they came across many other studies providing evidence that property values are positively affected by clean water and conversely, degradation in water quality can lower property values.
According to a press release, “This study used a ‘hedonic’ pricing model to estimate how much more people are willing to pay for homes with lake associated amenities. The data set consisted of over 7,000 sales transactions from 2004 to 2018. Estimates are in 2018 dollars.”
Results from the study revealed a 254% or $1.3 million average premium for the same home on the lakefront of Whitefish Lake versus 2 kilometers from the lake. Flathead Lake exhibited a 114% or $0.5 million average premium.
According to the study, Whitefish and Flathead lakes contribute upwards of $3 billion in property values, and $17 million to $25 million in property tax revenue.
Nanette Nelson, an environmental economist at the FLBS, said those findings are significant, because counties rely primarily on property tax revenue to generate the money to run the county.
She hopes by being able to provide this information to the lakefront landowners, it will spark greater interest in conserving the bodies of water.
Nelson said the one thing they weren’t able to directly measure was the relationship between water quality and real estate values, because in order to do that, there needs to be a change in water quality.
“Here in the Flathead, we are super lucky in that our lakes just stay clean -- I mean remarkably clean,” said Nelson.
She said they are relying on other studies that provided evidence that property values and water quality are linked.
“When you start seeing degradation in water quality, you see property values declining, or if you see the opposite, if you see an improvement in water quality, you see property values rebounding and increasing,” said Nelson.
However, officials said just because the water quality is good now, doesn't mean it always will be.
Researchers said for a lot of property owners, by maintaining the water quality, they are maintaining their investment in their property.
Kathy Sullivan, a Whitefish resident, said she believes Whitefish Lake is one of the most pristine lakes in the western states.
She said she believes lakefront property owners do a good job at conserving the lake, and she also applauds the Whitefish Shoreline Protection Committee for their preservation work.
Sullivan said she sees why people flock to Whitefish Lake, saying it's a beautiful lake with amazing recreation opportunities, both in the winter season and warmer months.
She added the water quality is very good, saying you can see right down to the bottom, even in 30 some feet of water.
For those who live on Flathead Lake or Whitefish Lake, according to the study findings, the better the quality of water, the bigger the economic benefits, just another reason to protect our waterways.
For more information on the study findings, click here, and to read the study in its entirety, click here.
