Cannabis has been a hot topic in the Texas Legislature this year. Touching both in health care and agricultural issues, hemp and medical cannabis have brought up some controversial issues. Let us clear the smoke around these topics, and discuss how it may impact real estate transactions.
H.B 1325. In June, the legislature approved H.B 1325, a U.S Farm Bill that removed hemp that contains less than 0.3% of THC from the Schedule I controlled substance list. Lawmakers, and farmers, believed restricting industrialized hemp production was limiting a lucrative and popular crop option. Now considered an agricultural commodity, it is legal to produce hemp as well as own CBD products derived from the hemp plant. The bill was enacted immediately and hemp production is already underway.
H.B 3703. Also updated this summer was House Bill 3703 (formerly known as the Compassionate Use Program) that expands medical cannabis treatment beyond intractable epilepsy to include multiple sclerosis, Parkinson’s disease, ALS, terminal cancer, autism and many kinds of seizure disorders. Specialty doctors may prescribe medical cannabis only in oil and inhaler forms; these types of products cannot be smoked.
While the ratification of these bills have caused a lot of debate, there are other serious issues being addressed. With no equipment to test if cannabis is within the allowed THC amount, many county court systems and law enforcement agencies have been forced to not prosecute low-level cannabis related cases.
But, how does this impact real estate? Good question. Many concerns have been lit up since these bills were enacted this summer. In other states that have legalized cannabis, or begun the process, real estate is a closely related issue. Overall, home prices in states that have legalized marijuana have risen quickly. Prospects of employment, as well as the desire to legally grow and buy weed, have boosted home sales and impacted buyers, owners, and sellers. In Colorado, for example, home prices are higher in the 60 CO cities and towns where cannabis is legal, compared to the 200 or so it is not.
There is disparity, however, with homes in states like Colorado situated around grow houses, farms, and its related crime, so it’s not all green, hazy pastures. The great state of Texas will need to determine regulations around cannabis-related agriculture, including buying or selling a farm or ranch used to produce hemp, and the transportation and distribution of the product. Legislators will also work on clarifying the HOA perspective, and what is allowed for residential and commercial properties as well as future development in Texas.
This, no doubt, will be a hot topic for many years to come. If you are looking to buy or sell in the Austin area and have questions related to hemp production, please contact one of our experienced real estate agents at Freedom 512.