Updated Feb 26, 2015, Updated March 14, 2017 (Websites links updated. Updated mortgage information.)
A grow op property is one that has been used for the production of marijuana, in many cases mass production. Other similar properties are meth labs or clandestine drug operations.
I regularly receive questions about grow ops in the city. My challenge is that the prices of these homes often attract new buyers or those looking for a deal. The first step is education and then careful review so that people can make an informed decision.
This is often how the process works:
- A home is built or purchased by Owner A. Owner A or their tenant use the property to grow marijuana plants and most often significantly modify the home to do so. Mold spores from growth accumulate in the home. Sometimes the home is also where drugs are directly sold. View what an example home looks like. ALERT posted this video on Feb 26, 2015.
- At some point the home may or may not be closed down by police and the health authority. Other times the owner ‘remodels’ and returns it to the market as a home for sale.
- If the health authority requires remediation an Executive Order will be produced and posted on the Calgary Health Region website. A caveat, a document declaring the issue, is registered on the property title. If you want to see some examples, go have a look. These aren’t minor issues. Examples include extensive mold growth, altered electrical systems, holes bored in foundation walls, plumbing altered and ventilation systems modified.
- The home is sometimes remediated as per the executive order. The challenge is that there are no current standards of remediation in the province of Alberta. There is no guarantee how the work was done or that future issues such as mold won’t return. Once the home is remediated, the caveat on title is removed.
- The home is listed for sale in the future either as a grow op, a remediated grown op or sometimes as a regular home if it wasn’t caught by police. Along comes potential Owner B. This is where realtors enter the picture. As a realtor, I cannot and will not list a property for sale that is a grow op or remediated grow op without full disclosure. Not everyone shares that opinion but all local realtors have been advised to disclose the history of a property. Private sales have no such requirements as it is not agreed that a remediated property still has a ‘material latent defect’ that would require disclosure. Buyer Beware prevails.
- Representing buyers. Many buyers inquire about and specifically request not to view or enter any homes that are grow ops, remediated or otherwise. Others consider the option due to the potential cost savings on purchase for a remediated property. Unremediated properties often sell for far under market value and investors or flippers sometimes review these options.
A newly emerging question is coming up around homes used as formerly legal growers for medical marijuana and if these homes pose any issues for future owners.
When representing a buyer reviewing a home, the potential that it was a former grow ops is always a consideration. As banks are less and less willing to provide a mortgage on such a property, it isn’t even an option in many cases. (A great article by BC mortgage broker addresses this side of things. ) 2017 Updated: Some lenders will now fund mortgages on these homes.
A thorough inspection can identify clues that a home was used as a grow op. Checking the internet for any information on the property is always a must. As the Calgary Health Region removes inactive properties, there is no public searchable database available to buyers or realtors to check even for legally busted properties. I think this absolutely must change so buyers have protection to at least have visibility to those properties reviewed by police and the health authority. The last thing I want to do is represent a buyer in purchasing a home that we later discover has such a history.
If a buyer wishes to purchase a home with such a history, careful review and education is essential. Some reading to get you started if you are considering the move.
Some informative links regarding grow ops in Alberta:
My family and I would never knowingly live in a former grow op. Nor would those of many inspectors and contractors I have asked. Why? Future economic uncertainty since banks and insurance companies are reluctantant to provide mortgage for these properties. Potential medical issues with a concern that the mold could return and also the knowledge that the home was used to produce and sell drugs. The folks who were originally involved and their friends and not so great friends may return for a visit one day. I don’t want my address on that list.
If you have further questions about this issue please feel free to give me a call and I can answer where I can and put you in touch with experts that work with mold and remediations. I've had great conversations with folks on different sides of this issue. The most important thing is that all information is available to potential owners so they can make an informed decision.