As of October 17th Canadians can legally consume marijuana recreationally without criminal penalties. The legalization of marijuana is a pretty ground-breaking piece of legislation that everyone is talking about, but many aren’t thinking how it will effect their real estate asset. The fact is, it will. Karyn spoke to CTV’s Your Morning about it earlier this week. Here are the highlights of the interview:

What Does The Legalization of Marijuana Mean To Homeowners?

Under the new legislation anyone over the age of 19 will be able to use recreational cannabis in their private home, including outdoor space and grow up to 4 plants. If you own a freehold house and want to grow and smoke in the family room or the backyard of that owned house, great. Follow the rules, not really a problem. If you live in a condo there’s a bit more involved. You’ll have to find out if the building’s rules allow it for starters. There’s 100’s of condo corporations already and more as we speak re-writing the declaration of the building’s rules to prohibit it and avoid some of the pitfalls that come from cultivation in a shared space. Some are prohibiting growth. Some are prohibiting both growth and any use on the property inside AND out. One thing for all owners to consider: growing cannabis plants will likely increase the risk of damage to the property, and as such, must be disclosed to your insurer.

What Does The Legalization of Marijuana Mean To Renters?

Smoking marijuana is a little bit like smoking tobacco. The smell devalues the property and is almost impossible to get rid of. That’s why you almost always see lease agreements including a no-smoking clause. Your landlord doesn’t want their property de-valued. So if they say no marijuana smoking inside, and your condo building says not smoking outside, you’re out of luck. Go find a friend with a backyard or it’s time to think about moving.

How Will The Legalization of Marijuana Affect New Homebuyers?

We already frequently see clauses written into purchaser agreements confirming the property has not been used for the growth of marijuana. And that’s because there’s associated health risks from growing it, not to mention, environmental risks. On the surface being able to grow 4 plants sounds moderate, but the legislation doesn’t limit the size of each plant. In other words, 4 plants in unmonitored conditions can grow mould, spread it, and other fungi. And often, unfortunately, the physical effects of a grow op can often go undetected during a home inspection. You’re going to have to be more diligent than ever now.

If having the right to smoke marijuana in your home is important to you, you’re going to want to make sure the building hasn’t yet banned it nor has any plans to. And if you find a condo that does allow it, is that building going to have a stigma attached to it when all the rest have? You may need to consider that the reason you are buying there is the stigma that may decrease it’s property value.

One more item to consider – many mortgage companies are reluctant to insure homes once used growing, so you’re going to want to make sure that if the home has been used to grow plants, that you don’t haphazardly waive a financing condition. To my knowledge lenders have not yet stated an official position on the new legalization.

Will Real Estate Listings Need To Disclose Whether Or Not Marijuana Was Smoked Or Grown In The Home?

No to smoking it – that you’ll have to use your nose. But yes to growing it. We’re supposed to disclose as much as possible when selling a property already. But that doesn’t mean it always gets disclosed. Our job and our clients job is to be ever more vigilant looking for possible evidence if it is important that cannabis not be in the home our clients buy. I’ve already drawn up clauses for my clients to use in purchase agreements.


For more questions about buying and selling, or the affect the new legislation will have on you, please contact us!

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