Tips for Vancouver Home Buyers:
What you need to know when buying a former Grow Op
As required by the Real Estate Board, one important detail that must be disclosed to Buyers is if your property used to be a grow op, (1) whether or not it was a grow op under your ownership, (2) whether or not you knew about it at the time (which can happen every now and then with the home is tenanted) and (3) whether or not it has been officially remediated with City of Vancouver Permits
There is a particular question on the Property Disclosure Statement (something Home Sellers fill out prior to their sale) about whether or not the unit “has been used as a marijuana grow operation or to manufacture illegal drugs”. Most agents (and I say most because there are some unprepared agents out there) will also have a clause in their Buyer’s contract with regards to the unit not being a former grow op to ensure that the the Sellers signs off on the fact that, to their knowledge, it was not a former grow op.
The City of Vancouver requires that all grow ops go through an extensive remediation once they are discovered, which can include renovations to the electrical, plumbing, ventilation, air quality and structure of the home. This remediation process is monitored by the City and requires official City approval to receive the Re-Occupancy Permit. The City takes grow-ops quite seriously, so you can be sure that if the unit received it’s “thumbs up” that the problem has been corrected. Given the number of renovations necessary, the owner of the unit will come out with a better/newer unit thanks to the upgrades done during the renovation.
There are times in which a grow op is discovered (for tenanted units), and the owner chooses sells the unit prior to being remediated. At this point, the Buyer would be accepting the property on an “as is, where is” basis, and would likely be tearing the property down, or renovating from the studs.
When selling former grow-ops, a little more work is required to get appropriate financing, as grow ops aren’t preferred by many lenders. Buyers do have options when it comes to their mortgage financing, typically with credit unions and private lenders, but it does require a little more finesse and a great Mortgage Broker who knows every angle you can take in these scenarios (here are some brokers we’d be happy to refer). Of course, those who don’t need a mortgage are free and clear! One beneficial aspect for Buyers is that you can generally get a good deal on these kinds of properties, which has its benefits in Vancouver’s expensive Real Estate Market.
Let us know if you have any questions! Or, check out our Home Buyer’s Guide.
