Having a cannabis dispensary in your neighbourhood may increase the price of your home; at least, this has been the case in Denver, Colorado, according to a new study.
University of Wisconsin Madison researchers found that Denver home prices in the immediate vicinity of a recreational cannabis dispensary have gone up dramatically since retail sales were legalized.
Researchers compared Denver home prices from 2013 to those in 2014, the first year of recreational cannabis sales. They concluded that single-family homes within 0.1 miles of a dispensary experienced an 8.4 percent increase in price, while homes in Colorado municipalities that had legalized retail sales saw a six percent increase in that same period.
“The presence of retail marijuana establishments clearly had a short-term positive impact on nearby properties in Denver,” said researcher Moussa Diop of UW Madison.
“This suggests that in addition to the sales and business taxes generated from the retail marijuana industry, municipalities may experience an increase in property taxes. It’s an important piece of the puzzle as more and more voters and policy-makers look for evidence about the effects of legalizing recreational marijuana."
The study revealed that the average property value increase for homes within 0.1 miles of a dispensary was $27,000 higher after legalization. Researchers identified a number of underlying factors that may have contributed to this increase, including lower crime rates, more nearby amenities and a rise in housing demand due to Denver's growing cannabis market.
"I think marijuana as a whole has raised prices on different fronts," Greg Eckler, a local real estate broker, told Westword. "People are moving here in droves. Some were going to move here anyway, while others are moving here because of marijuana."