Colorado is giving other states a new reason to legalize marijuana.
Denver’s home values shot up 10 percent between March 2014 and March 2015 — the second-largest increase in the nation for that time period — according to the S&P/Case-Shiller Home Price Indices.
The home-value growth rate nationally for that period was 4.1 percent.
A separate reading — the Zillow Home Value Index — also found values rising in the Mile High City, with an increase of 14.8 percent between April 2014 and May 2015. Zillow currently predicts values will rise another 6 percent by the end of April 2016.
Marijuana, which was legalized for adult recreational use by voters in Colorado in November 2012, may be helping drive the housing demand. The move was an expansion from medical marijuana use, which voters approved in 2000.
James Paine, managing partner at real estate investment firm West Realty Advisors, tells CNN Money:
“There has been a huge bump in real estate prices due to the legalization of marijuana. It’s massively pushed up raw land and industry prices.”
Kelly Moye, a RE/MAX real estate agent who has worked in the Denver area for 24 years, tells CNN that inventory has become tight: The city generally has about 24,000 listings, but currently has about 4,000.
And in this seller’s market, the median home value in Denver was about $306,000 as of last month — an increase of more than $100,000 compared to the same month in 2012, according to Zillow.
The demand for recreational cannabis also may be contributing to job growth.
As a new industry, legal marijuana has created jobs at businesses ranging from growers and dispensaries to security companies and electrician services, CNN reports. The Denver area has also become a hot spot for the technology industry.
Moye tells CNN:
“The quality of life is great, and employers are bringing their employees here.”
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