Denver’s Increasing Cannabis Industry Affects Local Real Estate Market

by San Antonio Attorney

Three years ago, the legalization of recreational marijuana brought increased economic growth in Denver.  The cannabis industry garnered in $700 million from last year’s sale and another $94 million from tax revenue, these are due for collection by 2016. However, as the cannabis industry flourishes, the local housing industry starts to perish.

As more home owners and entrepreneurs who want to enter the industry decide to move in Denver, the real estate prices go higher and become expensive to a local’s standards.

According to J.P. Speers, a real estate broker, many people are moving in their area probably due to the marijuana industry, which has consequently affected the housing market.

A number of millenials want access to marijuana and entrepreneurs who wanted to venture into marijuana industry prefer Denver as their residence since it legalization.

The bank’s refusal of lending funds for cannabis industry is also one factor that pushes entrepreneurs in moving Denver to start their own marijuana business.  Aside from business, they also purchase homes in cash and impose a high price on their property at the same time.

In the first six months of 2015, $253 million was already raked in by the cannabis business.

Denver authorities have already instituted rules for home owners of affordable housing units, to prevent the steep rise of value in mortgage.

Home owners have to carry out a one year notice whether they are planning to sell it or convert it into market rate rentals.  With a notice disseminated beforehand, the city will have ample time to raise funds to buy properties keep the units as affordable.  This new rules is attributed to Mayor Hancock’s efforts for raising funds in order to subsidize the costs of building new affordable units.

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