Brokers across the country are calling for complete disclosure when it comes to former marijuana grow-ops and one industry leader believes any house known to have formerly housed a grow-op should be demolished.
A potential home owner bumped an older MBN discussion to ask about former grow-op homes and one helpful answered her question.
"Unfortunately the "Grow Op" disclosure will always have to be reported when selling which scares many potential buyers, and yes, many lenders simply won't finance an ex grow op, even after full remediation, at least here in BC," one anonymous broker replied to an inquiry. "In my own opinion a fully remediated grow op property should be like any other house: no issues or concerns but the stigma still remains and people/banks have fears of incomplete remediation. Just like a car repaired after an accident."
Brokers across the country are calling for complete disclosure when it comes to former marijuana grow-ops and one industry leader believes any house known to have formerly housed a grow-op should be demolished.
“I think it should be disclosed at the very least but they should be torn down,” Mark Goode of Dominion Lending Centres Mortgage Man told MortgageBrokerNews.ca.
And in the province of Ontario, some townships have been doing just that.
“Some municipalities are tearing the buildings down because they’re worried about the recourse,” Goode said. “If someone in the building gets sick or gets cancer, they’re worried about that.”
Problems arise, however, when it is a rental house being used as a grow-up. Often, the owners aren’t made aware that their tenants are illegally growing marijuana and it is the owners who bear the brunt of any recourse.
“In the future, going forward, Realtors and lawyers are suggesting to those buying rental properties that they make sure the renters put utilities in their name so they aren’t liable for any recourse for hydro if it’s been stolen for a grow-op,” Goode said. “If the utilities are in the homeowner’s name they will be responsible for paying the funds for any stolen hydro.”
For his part, Goode pulled out of a personal deal as soon as he found out the house had formerly been used to grow marijuana. He cited concerns about unknowns pertaining to long-term ramifications.
“I personally looked at a former grow up house, myself and I turned it down,” Goode said. “I found out about it after; I wouldn’t be able to live with myself if my son got sick when I tried to save a little money on a house.”
As for communities that are home to a government sanctioned grow-up, Goode feels that property prices shouldn’t be negatively affected.
“It doesn’t do much damage outside – it dissipates in the air; I don’t think it will devalue property prices in the area.”
Currently, grow-op houses are red flagged in CMHC’s database and “the lender, the broker, the purchaser should all be made aware if it is a former grow-op,” Goode said.
