A rise in housing demand for properties near marijuana dispensaries has led to a surge in prices on Colorado’s real estate market, a research finds.
The report “Contact High” was conducted by researchers at the University of Wisconsin and California State University and found that houses located within .1 mile of a cannabis shop have increased in value, compared to those located farther away. The data compares home prices in the period before and after Colorado legalized recreational marijuana (2013-2014).
Moreover, the results also show that medical marijuana dispensaries that converted into recreational when the legalization was enforced have had a large impact on neighboring property values. According to report findings, a single-family house located near pot shops has increased in value by over 8 percent compared to other properties.
Researchers acknowledge that there are other drivers of the increasing property prices near marijuana dispensaries, but their study focuses on the effects of marijuana legalization. The research could help other cities that are already considering the impact of cannabis legalization on the local markets.