“RCMP report suggests the dramatic plunge in U.S. house prices has caused some gangsters to re-evaluate whether B.C. is really the best place to do business.”

From ‘Cheap housing luring Canadian marijuana growers into U.S.: RCMP report‘, The Province, 7 Aug 2011
The U.S. housing crash has lured some marijuana growers to move their operations south of the border, according to an internal RCMP report obtained by the Vancouver Sun.
“Some VOC (Vietnamese Organized Crime) groups have moved their marijuana grow operations to the United States where the lower cost of real estate (in some regions) allows them to operate a more profitable enterprise and where they can also avoid police/customs detection at the border,” states the RCMP report.

For more than a decade Canada has been home to a multi-billion-dollar marijuana-growing industry, the bulk of whose product has been shipped to the U.S.
B.C., where the largest number of those operations are located, has generally been seen as an attractive place for drug gangs to set up shop because the legal penalties for growing marijuana here are more lenient than in the U.S.
However, the RCMP report suggests the dramatic plunge in U.S. house prices has caused some gangsters to re-evaluate whether B.C. is really the best place to do business.
Since 2007, house prices in the U.S. have dropped by roughly a third nationwide and in some markets, like Las Vegas, by more than half.
During that same period, prices in most Canadian cities have been flat or rising, with particularly large price gains in Vancouver.
Growing operations tend to be located in residential properties, so real estate is one of the biggest expenses for growers.

11 responses to ““RCMP report suggests the dramatic plunge in U.S. house prices has caused some gangsters to re-evaluate whether B.C. is really the best place to do business.”

  1. Yeah those pesky customs officials. Now we know why the Conservatives have been pushing for open borders through continental perimeter security. 🙂

    I tell you what, though, if the US wants to increase employment they should be increasing the legalized marijuana grow operations in hard-hit areas of the country, like California, and tax it. God knows they have no other way of raising revenue.

    • Problem with this is that once it becomes legal it will be available for the asking and dirt cheap. It’s just a crop. The US can’t save its finances taxing pot any more than it can taxing tomatoes. I don’t smoke any more, but if I did and it was legal, I’d just grow my own in my backyard and hand out the surplus to friends.

      Much pot grown in lenient areas of California is now smuggled to other states, because the medical marijuana system in-state has made it so common and cheap that it is no longer profitable for many growers to sell in California.

  2. the reason why they’re here is not the cheap housing, it’s the soft criminal justice system. They’re not moving

    • But why buy in Vancouver? There are plenty of cheap properties outside the GVRD. Many grows in Vancity are in rentals, actually, precisely because it’s far cheaper to rent than to buy.

      As the article states, it’s likely more border security issues than anything else. And word — the US needs all the economic activity it can get; why not in-source weed production?

  3. sigh. RCMP

    Look at the penalty on drugs dealing in USA vs Canada. You know the RCMP waste money on not-so-useful paper work.

    Even if the report is true, what is the purpose of study like this?

  4. There was a grow op in a house on SW Marine Drive in one of those mansions a few years ago. Hardly a rental!

    • Thanks, will headline.

      • Come on, fellow Canadian patriots. Where is the bullish real estate “logic” on this one? You know, something along the lines of, “But we have much better strains of marijuana in Canada. Our grass is so much greener, the growers are more than happy to pay inflated real estate prices to grow in Vancouver instead of Seattle. Buy now or be priced out forever!” 🙂

  5. Anyone seen this “anecdote” at Mish’s blog?
    Secretly Broke in Australia

    To the world, Tracy and David Dodd are the very model of Australia’s relaxed and comfortable middle-class. They’re living the dream – three kids, a mortgage and a suburban family home on an acre block. But Tracey and David have been keeping a secret from their family and friends – they’re drowning in debt. No-one to look at you would think that you are struggling.

    This could be called “Secretly Broke in Vancouver”. There are thousands of stories like this (except for that “acre block”)

  6. You know it’s bad when grow ops find the fundamentals too expensive to use houses in Vancouver….

  7. The headline should read “BC now too expensive for grow operations to compete with lower cost US”. Housing prices now 3 or 4x, gasoline nearly double and power rates rising dramatically over the next 5 years – of course, business in BC is moving elsewhere helping to sow the seeds for a BC recession and collapse in housing prices.

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