Is Legal Marijuana Giving Local Housing Markets in 2023 a

Not exactly. As more states have legalized weed, it’s not giving real estate values the same sort of high they received a decade ago when homebuyers were moving to states like Colorado eager to start cannabis businesses and legally toke up. But it doesn’t appear to be hurting home values either, according to a recent report from the National Association of Realtors®.

And as more states are legalizing marijuana for recreational and medical use, landlords appear to be loosening up restrictions, allowing more renters to grow—and in some cases, smoke—it in their apartments.

The report is based on a survey of about 3,300 real estate agents that was sent out in March. There were 21 states and Washington, DC, where marijuana is legal for both medical and recreational use in March. Sixteen states have legalized marijuana solely for medical use.

About 27% of Realtors in states where both medical and recreational marijuana have been legal for more than five years have seen lease addendums restricting growing cannabis. That’s down from 44% in 2021, the last time the survey was conducted.

However, in the same states, many property managers are buzzkills. About two-thirds have seen lease addendums restricting smoking on properties, although that’s down from 76% two years ago. For states that legalized marijuana within the past five years, 56% saw smoking addendums, down slightly from 59% in 2021.

Yet when asked if they perceived an increase in crime near marijuana dispensaries, 69% of respondents either were unaware of any such increase or said there was no change. While 28% said they did perceive an increase in crime, actual crime increased only 18%.

That might suggest a lingering stigma over the use of marijuana, says Matt Christopherson, NAR senior research survey analyst.

“There is not a perceived or actual change in states where only medical marijuana is allowed,” he says. “In states where it’s allowed for recreation, there’s a higher perception of crime.”

In states where marijuana has been legal the longest, just 13% of real estate professionals saw a decrease in residential property values near dispensaries. However, 5% reported an increase.

A previous Realtor.com® analysis found that legal weed got home prices high in places like Colorado. Colorado tied with Washington to become the first states in the nation to legalize recreational use in 2012. That gave real estate prices a boost.

And far more respondents said they’d had no trouble selling a property that had been used as a grow house—ranging from 69% to 75%, depending on the state—compared with those who said it had been difficult to do so.

Those responses ring true for Amy Cesario, a Denver-based real estate agent with Compass.

“If legal marijuana has an impact on the housing market, it’s hard to see that in Denver,” she says. “We have a strong economy, and housing has been in demand here for years. Of course, homeowners and tenants who grow and use marijuana need to be careful of its impact on the property, just as they would with tobacco and other substances, but that’s rarely an issue.”

In fact, the smell is one of the biggest downsides of growing or using marijuana, says Christopherson, adding that it’s “completely fair” for owners and landlords to enact restrictions to protect their properties.

But it also makes it crucial for would-be buyers or tenants to know what will be allowed and what won’t before signing a contract or a lease.

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