DENVER — As home prices continue to increase throughout Colorado, a new study by Clever Real Estate found a link between marijuana legalization and the housing market.
The report looked at home values across the United States and found home values increased by $17,000 in states where recreational marijuana is legal compared to states where it is illegal or only allowed for medicinal purposes.
“We were very interested in understanding more about why recreational marijuana has such an impact on home values. It seems to us there are quite a few factors that are intertangled here,” Clever Real Estate Researcher and Writer Michelle Delgado said.
Delgado said there are a few contributing factors that impact these numbers.
First, new industries attract more jobs and employees looking for homes.
“Then, of course, tax revenue. These laws that are legalizing the marijuana industry bring in billions of dollars across the country in tax revenue. In Colorado, that goes entirely into education, and so people want to live where there are great schools,” Delgado said. “Other states use the revenue for things like public health, transportation — just things that can really improve quality of life in a state and all these contribute collectively to higher home values.”
Delgado said Clever also studied the direct impact of each new dispensary that opens.
“Places that allow recreational dispensaries saw home values increase by about $22,000 more than cities that don’t allow those dispensaries. And each new dispensary adds another $500 to home values according to our model,” Delgado said.
Delgado said Colorado has 742 dispensaries and 574 of those are recreational.