Everything Home Buyers And Sellers Need To Know About Cannabis Legalization - CREB Now
on Monday, October 15th, 2018 at 12:00pm.
In a matter of days, cannabis will become legal across Canada. How will this new era affect the home buying and selling process? CREB®Now sat down with Ryan DeLuca, supervisor of training and compliance at CREB®, to discuss the information buyers and sellers need to avoid getting stuck in the weeds.
CREB®Now: How will cannabis legalization affect the homebuying process?
DeLuca: Legalization won’t change the process itself, but it will affect buyer expectations of what the seller must disclose.
Buyers should pay attention to disclosure and ask direct questions like “has cannabis been grown in the property?” They should also talk to their mortgage broker and insurer to find out if home growth will affect their mortgage application or their ability to get home insurance.
CREB®Now: Will cannabis home growth affect the resale value of a property?
DeLuca: We won’t know the answer to this until cannabis becomes legal and statistics become available. Anecdotally, if we’re talking about small-scale home growth of four plants, there shouldn’t be very much impact on property value.
“MOST HOME INSPECTORS USE GROWING FOUR TOMATO PLANTS AS AN ANALOGY FOR THE EFFECTS OF MARIJUANA HOME GROWTH. REALISTICALLY, PEOPLE GROW PLANTS IN THEIR HOMES ALL THE TIME WITH LITTLE RISK TO THE PROPERTY.” – RYAN DELUCA, CREB® SUPERVISOR OF TRAINING & COMPLIANCE
Most home inspectors use growing four tomato plants as an analogy for the effects of marijuana home growth. Realistically, people grow plants in their homes all the time with little risk to the property.
CREB®Now: What are potential damages from cannabis home growth that buyers should be aware of?
DeLuca: Since cannabis has the potential to cause structural issues to a property, it’s recommended to get a proper home inspection.
With large-scale medical home growth and illegal grow operations, two big things to keep an eye out for are unpermitted electrical work and moisture/humidity issues that cause mould.
CREB®Now: Is it necessary to get a home inspection?
DeLuca: Getting a home inspection is always a good idea.
Sellers aren’t always aware of damages in their own homes, so despite asking direct questions, a buyer might discover unknown issues after purchasing the property.
It’s also a good idea for sellers to get a home inspection prior to listing. This way, the seller can correct any issues found and avoid having a deal fall through from damages discovered during the buyer’s home inspection.
CREB®Now: If a home seller has grown cannabis in their property, how do they ensure they’ve covered their bases?
DeLuca: Any time you’re doing something in the home that can create potential damage, move it outside if possible. Taking home growth outdoors or to a greenhouse is ultimately better for a property’s structure and its resale.
If you’re installing a large system for medicinal growth, get a building permit and hire a professional for proper installation so there is no risk of damages from poor workmanship.