As if brokers weren’t leery enough about deals involving former grow-ops, here’s another note of caution.
A Toronto writer who used his house as a small grow-op for personal use took a big hit when selling the home but that was just the tip of the iceberg. His story serves as a reminder to brokers about the potential pitfalls of purchasing these properties.
In his memoir, written for Toronto Life, Paul Illidge details the price he paid for growing eight marijuana plants in his Scarborough home.
“My wife, fearing the government was about to confiscate our house, insisted we put it up for sale. We received an offer for the full amount we were asking, but the buyers weren’t able to arrange a mortgage once their bank found out the property had been used as a grow op,” Illidge wrote. “Another couple put in a bid, then lowered it by $49,000 when they learned of the house’s past. In no position to bargain, we signed the offer.”
Former grow-ops have long been a bane to brokers, with many admitting they would endeavour to dissuade clients from purchasing such homes.
“Over the past few years, the majority of lenders in Canada no longer finance former grow-ops,” Scott Dawson, a BC-based broker wrote in an article for CMP in 2013. “There’s a good chance that if you walk into your local bank branch they’ll turn you away.”
Dawson also wrote that although buyers may get a deal in purchasing a former grow-op, the property is likely to cost in the long-run, as the client would likely be stuck with higher rates at origination and renewal.
It’s too late for the buyer of Illidge’s home, though. As for Illidge? He still has to live with the experience.
“It took a long time to get back to normal. Nicky had turned 18 a month before the bust, so he had a criminal record; his chances of getting a regular job were slim to none,” Illidge wrote. “Angry and ashamed that I’d messed up my son’s life so badly, I slipped into a depression, one that brought dark days and sleepless nights.”
In his memoir, written for Toronto Life, Paul Illidge details the price he paid for growing eight marijuana plants in his Scarborough home.
“My wife, fearing the government was about to confiscate our house, insisted we put it up for sale. We received an offer for the full amount we were asking, but the buyers weren’t able to arrange a mortgage once their bank found out the property had been used as a grow op,” Illidge wrote. “Another couple put in a bid, then lowered it by $49,000 when they learned of the house’s past. In no position to bargain, we signed the offer.”
Former grow-ops have long been a bane to brokers, with many admitting they would endeavour to dissuade clients from purchasing such homes.
“Over the past few years, the majority of lenders in Canada no longer finance former grow-ops,” Scott Dawson, a BC-based broker wrote in an article for CMP in 2013. “There’s a good chance that if you walk into your local bank branch they’ll turn you away.”
Dawson also wrote that although buyers may get a deal in purchasing a former grow-op, the property is likely to cost in the long-run, as the client would likely be stuck with higher rates at origination and renewal.
It’s too late for the buyer of Illidge’s home, though. As for Illidge? He still has to live with the experience.
“It took a long time to get back to normal. Nicky had turned 18 a month before the bust, so he had a criminal record; his chances of getting a regular job were slim to none,” Illidge wrote. “Angry and ashamed that I’d messed up my son’s life so badly, I slipped into a depression, one that brought dark days and sleepless nights.”
