NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.
Impact on Property Value
New Study: How Legalizing Recreational Marijuana Impacts Home Values (Clever, Aug. 3, 2021)
“On average, in states where recreational marijuana is legal, cities with retail dispensaries saw home values increase $22,888 more than cities where marijuana is illegal from 2014 to 2019. Per a CATO Institute study, homes close to retail dispensaries (within 0.1 miles) increased in value approximately 8.4 percent compared to those further away. This effect appears to bring up the entire city's home values at a rate higher than the national average.”
What Is the Impact of Marijuana on Real Estate? (Greater Capital Association of REALTORS®, Jun. 2, 2021)
“At this point, it’s not a question of whether this budding relationship between weed and real estate will last; now experts are wondering how much bigger the marijuana industry can grow and the future impact it will have on real estate as a whole. As more states join the legalization party, the demand for commercial real estate and residential real estate within those markets will only grow. For an industry prone to fluctuation, this is a big development that could leave everyone feeling pretty good.”
Marijuana Real Estate: How Recreational Pot Is Impacting the Neighborhood (The Zebra, Feb. 18, 2021)
“To understand where the housing market fits into marijuana’s impacts on the economy, we looked at housing trends in key states and compared growth to the national average. We discovered these correlations:
- Colorado and Washington both legalized weed in 2012; since then, property values in both states have doubled.
- After legalizing recreational marijuana, home prices grew at rates above the national average in 60% of states: Colorado, Washington, Oregon, Michigan, Maine, Nevada.”
There Goes the Neighbourhood: Legalised Marijuana and Property Values (INSEAD Knowledge Publications, 2021) E
“In our new paper, we show that the prices of homes around a new dispensary (within 0.36 miles or 600m) fall by 3-4 percent on average, compared to control areas. This decrease particularly affected younger, more diverse neighbourhoods. For the average home sale, it translated into a price drop of between US$10,100 and US$13,500.”
Contact High: The External Effects of Retail Marijuana Establishments on House Prices (Real Estate Economics, Spring 2020) E
“Using publicly available data from the city of Denver and the state of Colorado, this study examines the effects of retail conversions (conversions from medical marijuana to retail marijuana stores) on neighboring house values in Denver, CO. The study period reflects a time before and after retail marijuana sales became legal in Colorado in 2014. Using a difference‐in‐differences approach, we compare houses that were in close proximity to a conversion (within 0.1 miles) to those that are farther away from a conversion. We find that single‐family residences close to a retail conversion increased in value by approximately 8% relative to houses that are located slightly farther away.”
Property Management Concerns
Regulating Cannabis Smoking in Multi-Unit Housing (Public Law Center at Mitchell Hamline School of Law, Mar. 2022)
While this fact sheet includes many questions specific to California law, it also offers information about regulating marijuana use in in multi-unit buildings, laws pertaining to federally subsidized housing, and resources for learning more about cannabis regulation and tobacco control policies.
Why It Is Risky to Rent Real Estate to A Marijuana Business (InvestFourMore, Nov. 1, 2021)
“While the marijuana business can be very profitable it comes with issues and risks as well. There are some major issues that property owners need to consider if they are renting to a marijuana business. It is vitally important they check with their bank, and local authorities to make sure everything is legal and won’t cause big problems.”
Special Provisions: Minimizing Risk with A Strong Cannabis-Related Lease (njbiz, Apr. 12, 2021) E
“The enactment of medicinal marijuana laws and measures permitting the cultivation and sale of recreational marijuana have created new opportunities for owners of industrial and commercial real estate. Landlords who enter into leasing transactions with marijuana related operations must take into account particular legal and business risks. This article focuses on special lease provisions that landlords should consider including in any agreement with a marijuana cultivator or dispensary in order to minimize those risks.”
Can I Say “No Pot in My Apartments” When It’s Legal in My State? (Rental Housing Journal, Mar. 7, 2021)
“Rental Housing Journal did an interview with Seattle, Washington attorney Bret Sachter, an expert in tracking the progression and transformation of marijuana laws, to discuss some common questions property managers have about marijuana and tenants.
“I’ve been asked this a lot,” Sachter said, “but it does not come up as often as you might think. The overarching issue here is that, with few exceptions, people can do what they want to protect their property, even if the prohibited behavior is not illegal. You can prohibit smoking, prohibit pets, but with marijuana it’s much easier because it is federally illegal. So you can pretty much prohibit it if you want to no matter what, even medical marijuana,” Sachter said.”
Real Estate Opportunities
New Why Commercial Real Estate Investors Are Setting Their Sights on Cannabis (EisnerAmper, Feb. 23, 2022)
“What initially caught the eye of many commercial real estate (CRE) investors and opened the market for the cannabis industry was its performance during the pandemic. Cannabis dispensaries were deemed essential in many states and allowed to continue operating, as opposed to traditional retailers, which took a major hit when they were forced to close. During that same time, multiple states reported legal marijuana sales from dispensaries reaching all-time highs, according to the International Journal of Drug Policy.”
How Cannabis Legalization is Shaping Commercial Real Estate (Mann Report, Jan. 24, 2022)
“Property has always been considered an attractive investment and cannabis has only improved it. In the U.S., the value of industrial-zoned properties in the commercial real estate sector is $1.5 trillion. When comparing the U.S. cannabis industry’s economic impact against total GDP, estimates illustrate that cannabis development projects will create a Total Addressable Market of $50 to $75 billion in commercial real estate, accounting for about half of a percent of industrial real estate.”
What Is A Cannabis REIT? (JDSupra, Apr. 26, 2021)
“Investors show increasing interest in the cannabis industry due to the growth potential and high yields on invested capital. According to public filings from Subversive Real Estate Acquisition REIT LP, which cites broker research, cannabis REIT transactions are providing yields on invested capital in the range of approximately 11-18%. In addition to potentially high yields, despite recent headwinds in the capital markets, the marijuana industry remains poised for growth.”
Marijuana and Real Estate: A Budding Issue (National Association of REALTORS®, Apr. 2021)
“The real estate industry and its professionals are constantly adapting to not only national and local trends, but also to local laws and regulations. With constant changes in the legal status of both medical and recreational marijuana, there undoubtedly have been direct changes to real estate from these laws and related businesses. In this report, we examined the similarities and differences of effects from marijuana legality on various aspects of real estate, as well as any shifts from the last time the study was conducted in 2020.”
Medical Marijuana and the Workplace
It's Time to Rethink Marijuana Policy, Testing (HR Specialist: Employment Law, May 2022) E
The article offers tips to companies which are planning to drop their workplace testing for marijuana amidst the increasing number of U.S. states legalizing medical and recreational marijuana. Also cited are the percentage of workplace drug tests that came back positive for marijuana as per Quest Diagnostics data, and some tips like revising employee policies on marijuana testing and adding language to the no-smoking policy.
Marijuana Laws and the 2022 Workplace (SHRM, Mar. 31, 2022)
“Growing acceptance of marijuana use in recent years has led to the proliferation of state laws legalizing medical and recreational cannabis consumption, as well as a push for employment protections for off-duty use. Here's what employers need to know about evolving marijuana laws and their impact on the workplace.”
Workers Who Legally Use Cannabis Can Still Lose Their Jobs (Pew, Mar. 2, 2022)
Even where marijuana is legal in some form, workers may be fired or denied a job for using marijuana in their free time. Some states have recently passed laws to prevent discrimination against workers for legal marijuana use, but similar bills in other states have encountered opposition from business groups.
Cannabis & Employment Laws (National Conference of State Legislatures, Nov. 1, 2021)
“Most states that have legalized medical or recreational cannabis leave testing decisions up to the individual employer’s discretion. A handful of states have policies in place that somehow address anti-discrimination for medical cannabis patients. Significantly fewer states require employers to carve out accommodations for these patients.
The following table includes states that have some kind of statutory language requiring employers to not refuse employment or otherwise discriminate against a qualifying medical cannabis patient (or medical cannabis “cardholder” in some states).”
eBooks & Other Resources
The following eBooks and digital audiobooks are available to NAR members:
American Landlord Law (eBook)
The Complete Landlord.com Ultimate Landlord Handbook (eBook)
Complete Landlord and Property Managers Legal Survival Kit (eBook)
Every Landlord's Legal Guide (eBook)
Strategies for Working with Small Tenants (eBook)
What Every Landlord Needs to Know (eBook)
Have an idea for a real estate topic? Send us your suggestions.
The inclusion of links on this page does not imply endorsement by the National Association of REALTORS®. NAR makes no representations about whether the content of any external sites which may be linked in this page complies with state or federal laws or regulations or with applicable NAR policies. These links are provided for your convenience only and you rely on them at your own risk.