Legalizing Marijuana Increases Housing Prices, Study Finds

So much for “there goes the neighborhood.” A new analysis suggests that states that legalize marijuana actually see a boost in housing prices, with the effect most pronounced once nearby retail outlets open for business. Economists at the University of Oklahoma attempted to tease out the impact of adult-use cannabis legalization by examining listings on Zillow.com and tracking them against legalization in Colorado and Washington State. Their findings suggest legalization “has beneficial spillover effects at both the state and local levels,” casting doubt on the parade of horribles sometimes warned of by law enforcement and other critics. “Concerns about the potential effect on crime rates and the difficulty in policing impaired driving have been cited as reasons to slow-walk the path to full recreational legalization,” the study’s authors write. “This research contributes to the discussion, providing evidence that recreational marijuana legalization (RML) has large positive spillover effects on the local housing market.” Via SSRN. Specifically, neighborhoods in Colorado and Washington saw a 7 percent price increase as marijuana retailers there opened shop, the study, which was published online this week by SSRN, found. “Considered together, this research suggests that there are second order benefits associated with marijuana legalization that policy makers and voters should be aware of when deciding the drug’s legal status.” “Once recreational marijuana becomes available to buy easily at a dispensary and tax revenue is generated, there is significant home price appreciation.” It’s not the first time researchers have looked into the effects of legalization on nearby…

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