Counting ballots for the 2020 election took much longer than usual because many states allowed residents to cast their votes by mail to prevent COVID-19 from spreading. While many races remained in limbo for days, new voter initiatives against cannabis prohibition took an early lead. Voters seem to have made a clear statement: they may differ on politics and political parties, but most of them want an end to strict laws that punish people for using medical and recreational marijuana.
Voters in five states (Arizona, Mississippi, Montana, New Jersey, and South Dakota) approved ballot initiates that will lead to an expanded landscape for legal cannabis. It will take some time for states to write the regulations that will let consumers purchase cannabis from approved dispensaries. Even though it will likely take a state like South Dakota up to two years to prepare for the legal changes, investors and business owners in the cannabis industry need to take action now before they get crowded out of emerging markets.
A General Shift Away From Cannabis Prohibition in the United States
A few decades ago, cannabis legalization looked nearly impossible to many reform advocates. Even in 2020, the federal government considers cannabis possession illegal for any reason, including medical reasons.
After the 2020 election, 15 states have legalized recreational cannabis for adults. Once the newest states approve their regulatory processes, adults 21 and over will have access to quality, legal cannabis products through licensed dispensaries.
It’s important to note that these states do not always share political ideologies. South Dakota and Montana voted heavily in favor of Republican candidates in 2020. New Jersey favored Democrat candidates by a wide margin. Democrats and Republicans ran tight campaigns in Arizona that lead to a slight lead for the Democrats. Across political ideologies, people recognize that cannabis prohibition causes more problems than it solves. It simply makes more sense to write laws that give adults access while generating taxes for state governments.
Medical marijuana has become even more widely accepted. In 2020, 35 states have legal medical marijuana. Washington, DC, Guam, Puerto Rico, the Northern Marina Islands, and the U.S. Virgin Islands have also legalized medical cannabis.
How the 2020 Election Will Shape the Future of Cannabis Consumption
Citing the National Academy of Sciences, Drug Policy Alliance notes that decriminalizing cannabis doesn’t necessarily increase marijuana usage. People who haven’t used cannabis may purchase edibles, flowers, and other products out of curiosity. Few of them remain steady buyers, though.
Legalizing cannabis can create the appearance of increased use, though, by bringing black market buyers into regulated dispensaries. When cannabis is illegal, authorities can only estimate the number of users by extrapolating from arrests and citations. The approach may offer a ballpark figure, but it will never give an accurate number of cannabis users.
The 2020 election will make it easier and safer for cannabis users to purchase the products they use. Many will also discover opportunities to use new products, such as concentrates and edibles that do not require smoking.
Expanding cannabis legality also moves money from the black market to regulated dispensaries that must follow rigorous laws regarding who gets to buy products and how products get labeled. In the black market, buyers don’t know what they get from dealers. In an open, legal market, customers can make informed decisions by comparing the levels of THC, CBD, and other chemicals to pick an option that matches their preferences.
Reducing the size of the black market means that more outdoor and indoor farms can start growing cannabis openly within the United States. Instead of supporting criminals trafficking drugs across borders, customers can support businesses that think about health and giving back to communities.
Anyone interested in benefiting from the expanding landscape of legal cannabis should begin looking for opportunities now before their competitors take advantage of the best real estate options, dispensary locations, and limited licenses.
Arizona Passes Ballot Initiative for Recreational Cannabis (search Arizona Listings)
Quick facts about Arizona and cannabis laws:
- Arizona has a population of about 7.279 million people.
- A recreational cannabis ballot initiative failed to pass in 2016.
- Arizona Proposition 207 legalized cannabis with approval from nearly 60% of voters.
Arizona has a diverse ecosystem that makes it suitable for indoor and outdoor cannabis cultivation. Some parts of Arizona have become essential to growing grapes for wine. Outdoor farms could play a similar role in growing cannabis for consumers within the state. With such a large population, entrepreneurs have ample opportunities to earn money from cannabis grown and sold in Arizona.
Mississippi Voters Pass Law for Medical Cannabis (Search Mississippi Listings)
Quick facts about Mississippi and cannabis laws:
- Mississippi has a population of about 3.15 million people.
- 2020 ballots included two voter initiatives for medical cannabis.
- Initiative 65 offered a more lenient approach to Alternative 65A offered by the state legislature.
- Initiative 65 passed with 74% of voters approving.
Passing medical marijuana will give patients access to the cannabis products they need to feel better while undergoing treatments for numerous conditions, including cancer and PTSD. Typically, medical marijuana has stricter regulations than recreational cannabis. Still, cultivators and sellers have opportunities to earn money while helping patients choose products that treat their unique conditions.
Montana Voters Pass Legal Cannabis Initiatives (Search Montana Listings)
Quick facts about Montana and cannabis laws:
- Montana has a population of about 1 million people.
- Montana passed medical marijuana laws in 2004 and survived a 2011 attempted repeal.
- Nearly 57% of Montana’s voters chose to legalize recreational cannabis for adults.
Montana passed its medical marijuana law more than a dozen years ago. Since then, it has overcome several attempts to repeal or limit the law. Now, Montana voters have decided that they want to legalize recreational cannabis for adults 21 and over.
Montana’s frosty winters probably mean that most cannabis cultivators in the state will opt for indoor operations that let them control factors like temperature, soil acidity, and light exposure.
Medical dispensaries might start selling recreational products, too. Bringing underground market buyers into the public space, however, will likely mean that more dispensaries open to serve the needs of recreational users.
New Jersey Voters Legalize Recreational Cannabis (Search New Jersey Listings)
Quick facts about New Jersey and cannabis laws:
- New Jersey has a population of about 8.88 million people.
- New Jersey passed medical marijuana laws in 2010 that applied to people with a limited number of health conditions.
- The state has increased the number of qualifying conditions since 2010.
- Nearly 67% of New Jersey voters approved a constitutional amendment for cannabis possession, cultivation, and sales.
New Jersey’s decision to legalize recreational cannabis will have a huge impact on surrounding states, especially New York.
New Jersey already has a large population that will support a growing cannabis industry. Inevitably, people from neighboring states will cross the border to buy legally. New York, for example, has not been able to end prohibition on recreational cannabis (although it does offer medical marijuana).
Now that New Jersey has made the step to full legalization, New York will feel pressured to follow the state’s lead. Otherwise, New York will lose tax revenues as people hop a bridge to buy diverse cannabis products from legal dispensaries.
South Dakota Passes Ballot Initiative Legalizing Cannabis (Search South Dakota Listings)
Quick facts about South Dakota and cannabis laws:
- South Dakota has a population of about 885,000 people.
- An attempted 2018 initiative for medical marijuana did not receive enough valid signatures to get placed on the ballot.
- Slightly more than 54% of South Dakota voters approved a constitutional amendment legalizing recreational cannabis.
South Dakota voters surprised the nation when they passed a constitutional amendment legalizing recreational cannabis. It’s surprising because cannabis advocates in the state couldn’t get enough signatures in 2018 to even get a medical marijuana initiative on the ballot.
South Dakota has a climate similar to Montana’s, so most cultivators will choose indoor grows over farmland.
What Expanding Cannabis Legality Means for Investors
Expanding cannabis legality across the country means that investors need to start exploring their real estate options as soon as possible. Cities throughout the United States have seen higher real estate values after passing recreational cannabis laws. Even home prices have skyrocketed in recent years. One study shows that legalizing retail cannabis in Colorado contributed to a 6% increase in housing values.
Making money from newly legal cannabis markets requires investing in real estate for growing and selling products. In some states, investors have spent millions on farmland and warehouses that get retrofitted to grow marijuana. Retail space also comes at a premium when selling legal cannabis.
States will need some time to determine how they want to regulate new markets. That gives investors some leeway before real estate prices increase. For many people, it makes sense to buy property for cultivating and selling marijuana now instead of waiting for the state to solidify their regulatory requirements. Investors that wait will end up spending more money on properties that they could have gotten for considerably lower prices today.