How Marijuana Legalization Should Impact Your Lease Terms

Being a landlord is all about knowing how to write the rules. But in marijuana legalized states, the rules are changing.

  • Saturday, May 30, 2020

  Matt Angerer

  Legal   Cannabis   Marijuana   

Being a landlord is all about knowing how to write the rules. But in marijuana legalized states, the rules are changing.

A well-written lease has always been the key to happy landlords and tenant teams. The difference between a rookie landlord and an old pro is often found in how the lease is written. The difference between a cool landlord and a stick-in-the-mud is whether the rules are intuitive and practical. When you know how to create the right rules in your rental leases, tenants both know what to expect and even enjoy living within your supportive rule structure.

But how should your rules change now that marijuana products are becoming legal? What behaviors should you reassess and permit? What behaviors do you need to specifically ban? Do you need to make any changes at all?

Today, we're here to answer these questions and more with an in-depth look at how marijuana legalization can and should change legal state rental home policies.

What Should Your Lease Say About Marijuana?

  1. Permit or Ban on Property
  2. Ban Smoking Indoors - Define Back Porch
  3. Define If Indoor Vaping is OK
  4. Be Prepared to Permit Medical
  5. Handle Damages Normally

Identify Your Assumptions

It's no longer appropriate to assume all marijuana users are kids, slobs, criminals, or hooligans.

  • Did you know that nearly half of today's dispensary customers are over 55? That ratio can go above 50% in smaller and older communities.
  • Of the younger population, most did not use cannabis before it was legalized or had only tried it once or twice with friends.
  • Many people who use marijuana also have no trouble holding down a job, keeping a clean house, or paying their bills on time.

In simplest terms, marijuana has moved from a tenant-screening issue to a tenant-behavior issue. So that's what your lease should reflect with new policies and approaches to marijuana use.

To Permit or Not Permit?

Legalization gives landlords the unique opportunity to choose. Just like smoking cigarettes or allowing pets, the law puts the decision in your hands. The only exception is medical requirements. If a tenant is prescribed cannabis, you may need to permit it. About the same as a support animal.

Establish a Clean Home

If you are someone who just isn't comfortable with marijuana, and couldn't relax knowing that it could be in one of your rental homes, you don't have to allow it. If you state up-front and put in the lease that no cannabis is permitted on the property, that's that. Most marijuana users will be fine looking elsewhere. And renters who feel as you do will be happy to find a place that definitely won't have any lingering pot smell.

420 Friendly

Alternately, if you consider yourself a laid-back landlord and want to permit cannabis use, you now have that freedom. Simply put the phrase "420 Friendly" in your rental description and enjoy the wave of applications from renters young and old who don't want to tangle with an uptight landlord over vaping vs smoking. That said, you can still absolutely set rules like no smoking indoors and additional cleaning fees. That's how one balances "being cool" with good property management.

Ruling on New Tenant Behaviors

If you've been renting to tenants for any time at all, you know that defining tenant behavior is far more useful than broad-stroke rules. Tenants tend to interpret the rules flexibly and in their favor, and knowing what a tenant will do when you're not present is vital to writing a good lease.  So understanding how modern marijuana users behave will help you define what is and is not allowed in ways that help them follow your rules.

Let's break down these behaviors into categories.

  • Smoking
  • Vaping and Dabbing
  • Baking Edibles
  • Being Stoned
  • Guests and Parties

Smoking

Even if you permit marijuana on the property, you will still want to define that smoking anything is not permitted indoors. No cigarettes, no joints, no blunts, no pipes. It's not that you object to marijuana, just the physical action of smoke touching your walls and air ducts.

***For 420-friendly landlords, put extra effort into maintaining a back porch that is welcoming for smoking. Then define in the description that smoking is ONLY permitted on the back porch, where it won't be seen by neighbors or enter the home.

Vaping and Dabbing

Vaping and dabbing involve marijuana concentrates. They are stronger, but they are also cleaner in the air. Concentrates do not leave a lingering weed-smell or discolor the walls. If you define no smoking indoors, some clever stoners will determine that they can likely vape in the house without trouble. But you can be on the ball by defining whether vaping is or is not permitted indoors before they have a chance to gray-area the issue.

Baking Edibles

There is no possible harm that could come to the house from tenants cooking with marijuana. At least, no more risk than trusting any tenant to use the stove. But this is one of the new behaviors that comes with tenants allowed to have marijuana in the home. Defining that marijuana cooking is permitted might even attract some tenants who would otherwise worry about gray areas.

Being Stoned

If your biggest worry is what tenants will do while stoned, it is safe to relax. Most people are relaxed and a little sleepy or hungry on marijuana. There is one interesting exception. There is a sub-section of the stoner population who get energetic with the right strain. Almost invariably, they tend to do creative work, clean and garden, or do handy projects as a form of active relaxation.

*** Consider pet-and-stoner safe flooring. In most cases, the biggest risk of having stoned people in the house is stained carpets from knocked-over drinks. 

Guests and Parties

Finally, you may be worrying about big parties. This comes from the association of marijuana and college students. In reality, people who enjoy marijuana who are 25 and older are about as likely (if not less likely) to throw raging parties than anyone else of the same age. They might have more laid-back pizza gatherings than others, but that's not the same kind of risk to the property.

What Should Your Lease Say About Marijuana?

We hope this article has been enlightening about how the introduction of legal marijuana has (and hasn't) changed the terms of your lease provisions. Once you understand the new behaviors and expectations that legal marijuana brings, you can easily define a few practical rental standards. Remember our summary from the beginning of the article? 

  1. Permit or Ban on Property
  2. Ban Smoking Indoors - Define Back Porch
  3. Define If Indoor Vaping is OK
  4. Be Prepared to Permit Medical
  5. Handle Damages Normally

Each of these points has been explored and explained. It's now up to you to decide what your lease will reflect and how you will choose tenants in a legalized rental community. Want a little extra help building the perfect lease for each property? Contact us today!

About the author

Matt Angerer is the Founder and President of VerticalRent. He enjoys writing on a variety of topics that help Landlords, Property Managers, and Renters across America. He is particularly interested in helping renters understand their local marketplace, pick the best places to live, and find an awesome roommate. Since 2011, VerticalRent has grown to service over 100,000 landlords and renters across America. 

Read more articles from Matt Angerer



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