Citizens of the United States love their freedoms; this principle is a founding ideal behind our nation’s inception. It should be no surprise a recent real estate study from Redfin, which involved 1,023 U.S. residents who moved to a new home during the 18 months prior to answering the questions in August, found more people prefer to live where medicinal and recreational cannabis is legalized. If this is what Americans want, then marijuana real estate is a key topic upon which businesses should mobilize.
According to the survey, of those who recently moved to a new metro area, 46% said they prefer to reside somewhere cannabis is “fully legal,” as opposed to 22% of respondents who desire to live where prohibition is still active. Within the survey, 32% alleged they didn’t care or didn’t contemplate legalization when considering where to live. Diving down into the numbers, more than one in 10 respondents, or 12%, said they would only consider living where cannabis can be legally purchased. Conversely, 10% of surveyors noted they would not relocate where criminalization has ended.
Regarding the survey, Taylor Marr, the deputy chief economist for Redfin, said in a press release: “People take the politics of a place into consideration when deciding where to move, but the truth of the matter is that other factors including housing affordability and access to jobs and schools take priority. Oftentimes this means someone will move from a blue state to a red state (or vice versa), but choose a home in a neighborhood where most people hold the same political views as they do.”
Need another reason to strive to be one of the best weed legal states to live in? Other analyses, including one published in 2022 using data from online real estate marketplace Zillow, has shown marijuana legalization is associated with higher residential property values.
“Home values increased $6,338 more in states where marijuana is legal in some form, compared to states that haven’t legalized marijuana,” it concluded. This finding was backed by an analysis from last year, where economists at the University of Oklahoma similarly found that states which legalize cannabis see a boost in housing prices, with the effect most pronounced once nearby retail outlets open for business. For every $1 million in additional tax revenue from cannabis sales, home values increase by $470, according to another study.
Further research released this month, which was authored by a federal official with the U.S. Department of Agriculture, ties marijuana legalization to lower crime rates, a universal factor when buyers are reviewing home values and neighborhood desirability. One reason for the increased value is the associated tax revenue that comes with legalizing and regulating cannabis. Said revenue translates into “new investment in things such as public services and infrastructure.” Places where marijuana is legal in the US have the proverbial leg up in multiple ways from sites not officially found under a Google search for “where is marijuana legal”.
One example is the state of Illinois. In 2021, the state sold around $670 million in cannabis, taking in $205.4 million in tax revenue. Some of this revenue was funneled into supporting organizations that work to decrease street violence — this in turn boosted property values.
A Clever Real Estate study found legalized states saw the greatest gains in home value: “Between April 2017 and April 2021, property values rose $17,113 more in states where recreational marijuana is legal, compared to states where marijuana is illegal or limited to medicinal use.”
For the states that have sanctioned legalization but where sales have not yet started, “home values are predicted to increase by an average of $61,343. Home values increased $22,090 more in cities with recreational dispensaries, compared to home values in cities where recreational marijuana is legal but dispensaries are not available. With each new dispensary a city adds, property values increase by $519. When we controlled for other factors, we found that home values in areas that have legalized recreational marijuana leapt by $17,113 more than places where marijuana is illegal or only allowed for medicinal use. Even when we limited the comparison to recreational versus medicinal legalization, this disparity persisted. Places that legalize recreational marijuana saw home values increase by $15,129 more than those that only legalized medicinal use.”
Cannabis legalization affects all aspects of society and with more work-from-home options available, flexibility for American families is at an all-time high. Now is the time to plan and launch your cannabis business, and Canna Real Estate Group is the best way to cut through the confusion. Whether you’re opening a dispensary, designing a commercial greenhouse, starting a grow house, or building a manufacturing facility, we are here to help. We know marijuana real estate through and through.
CREG specializes in commercial cannabis real estate in places where marijuana is legal and provides financial, architecture and construction consulting. Get inspired by some Case Studies, then contact us for a marijuana real estate consultation.