Do Marijiuana Laws Affect Real Property Values?
by Administrator on Nov 30, 2016
Being told by market participants that they were influenced by the changing marijuana law in Nevada caught me off guard. It never occurred to me that a recreational marijuana law in Nevada would affect buyers. I didn't vote for the legalization, its hard for me to believe that any more openess in Las Vegas will lead to good things. I guess for visitors it may be great but for those of us who provide a service I just can't see that a few thousand new "stoned" drivers or pedestrians moving around will be a benefit.
I was immediately skeptical when told that Colorado homes increased in price after the approval of their law, so I hit Google and did a little research. Turns out there are a number of reports that have indicated strong upward movement in the housing market following legalization. One CNN Special Report noted that an article published In March noted that "Denver experienced the second-largest jump in (its) annual home prices at 10%, just behind San Francisco, according to the S&P/Case-Shiller Home Price Index."
Turns out there has been a boom related to growers, dispenseries, tax revenues and accessorie sales. Who knew? I have some reservations calling strong real property market performance a good thing when it is caused by an event or a law that might not be that great for the community but it appears that there are compelling statistics.
Will Nevada home prices also elevate in response to an influx of people and / or the added market activity generated by pot? I'm sure that the economic activity will provide jobs, sales and taxes. The fact that Nevada is just becoming another state that allows marijuana could however dampen any rush to the state as was seen in Colorado.
We may see some benefits to the state from the legalization but they may not extend to increased home prices. I'm sure that there will be several studies that track the impacts to Nevada (an California) markets as marijuana legalization becomes a reality.
When stationed overseas I often thought that just allowing citizens to make their own choices with regard to their drug or drugs of choice was not a bad way to go. Anyone who wants a drug, restricted or not, will generally find a way to find it.
If the Las Vegas Nevada real estate market ticks up in response to the passage of our new marijuana law, and its a significant increase, residents will benefit by seeing their equity increase in their homes and appraisers will document the increases over time.
For more appraisal information contact Glenn J. Rigdon MA, MRICS, ASA is a Las Vegas / Henderson Nevada based appraiser who can be contacted via email or via his business website known as Appraiser Las Vegas (http://www.appraiserlasvegas.com), or you can also click on “Contact Us” on the home page of this website or visit my public profile at LinkedIn at http://www.linkedin.com/pub/glenn-rigdon-ma-mrics-asa/1a/30b/879/
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