The housing market in Denver has been excruciatingly hot this year. In fact, in some months, prices have risen more than that of any other city. This rise has often been credited by the growth of the tech sector in Denver. This is because jobs in technology sector have been paying very well and as a result, “the more meteoric a market’s rise.” However, it seems that an even more “homegrown” reason is to be attributed to the rise. The New Republic states that a marijuana boom may be a reason for the housing availability crisis.
“In 2014, Colorado marijuana sales totaled $700 million, and the state expects to collect $94 million annually in cannabis taxes by 2016,” according to the New Republic. “But economic analyses about weed’s success never mention skyrocketing housing prices in Denver, a city that’s rapidly becoming unaffordable for all but the wealthy.”
Earlier, the marijuana business was seen as good thing for Denver’s real estate market.
“There has been a huge bump in real estate prices due to the legalization of marijuana,” said James Paine, a managing partner at West Realty Advisors. “It’s massively pushed up raw land and industry prices.”
Back then, they said it was “relatively affordable,” but what about now? At the moment, the median price for a home in Denver is $350,500, which is 15.9% more than it was just a year ago. Other sectors (residential, commercial, industrial, etc.) are all down 3.1% from what they were last year. This may or may not be a coincidence since it’s difficult to differentiate the marijuana boom from the other industries in Denver. The definite thing is that Denver’s economic health has grown significantly due to its home values. Some may be worried about affordability, but others are “basking in the glow of the market.”
MAPH Enterprises, LLC | (305) 414-0128 | 1501 Venera Ave, Coral Gables, FL 33146 | new@marijuanastocks.com
