Homeowners in cities that permit legal recreational marijuana sales enjoy higher property values than those in areas with prohibition, according to a new study from Clever Real Estate.
While marijuana is illegal on a federal level, in recent years many states have taken steps to legalize marijuana for recreational purposes. Home values in these areas with legal marijuana have experienced a hefty bump in value, particularly over the last two years.
“States that legalize recreational cannabis see an immediate bump in home values following legalization, even without retail dispensaries opening up,” read the study’s findings.
“From 2017 to 2019, cities where recreational marijuana is legal saw home values increase $6,337 more than cities where marijuana is illegal (controlling for population, initial home values, and GDP).”
Home in cities within close access to legal marijuana dispensaries experienced an even larger increase in value– an average of $22,888 more per home between 2014 and 2019.
In cities where only medical marijuana is legal, home values were comparable to cities where marijuana is illegal, suggesting that the increase in home values should be attributed to recreational marijuana legalization.
Clever Real Estate assessed the impact of marijuana legalization on home property values by using data provided by the real estate website Zillow.