It’s high time the real estate industry started to talk about cannabis. A new study from Clever Real Estate reveals the true impact legalizing cannabis has on local housing markets.
Opponents of legalizing cannabis argue that legalization leads to elevated crime rates. In the real estate world, higher crime rates lead to lower property values and poor investments, so we needed to get to the bottom of this debate.
Does legalization lead to budding industry or stoned cold housing markets?
Here are the takeaways you need to know.
Key insights:
- Between 2014 and 2019, cities that allowed retail dispensaries saw home values increase $22,888 more than those where cannabis remains illegal
- CATO research supports these findings, suggesting homes close in proximity to cannabis retail dispensaries tend to increase in value
- For cities where only medicinal cannabis is legal, home values increased at a comparable rate to cities where cannabis is illegal; a statistically significant increase in home values could not be attributed to medicinal cannabis legalization
- States that legalize recreational cannabis usage, however, see an immediate bump in home values following legalization – even before retail dispensaries begin to pop up
- From 2017 to 2019, cities that legalized recreational cannabis usage saw home values increase $6,337 more than those where cannabis is illegal
Our findings show that in cities where recreational cannabis has been legalized, home values increase at higher rates than in those where cannabis is illegal or only legal medicinally.
Additionally, between 2014 and 2019, cities that allowed retail dispensaries saw home values increase $22,888 more than those where cannabis remains illegal. These insights are consistent with findings from the CATO Institute; homes closer to retail dispensaries are approximately 8.4 percent more valuable than those further away.
Our study also found that from 2017 to 2019, cities that legalized recreational cannabis saw home values increase $6,337 more than those where it remains illegal. This suggests that housing markets respond immediately to pro-market cannabis legislation.
The full report can be viewed here, and includes case studies from:
https://listwithclever.com/real-estate-blog/marijuana-housing-market-study-pr/
Contact thomas@movewithclever.com for questions about the study or for specific metrics about your city.
About Clever Real Estate
Clever Real Estate is a referral network that connects top-rated real estate agents with home buyers and sellers at a discount rate.
