A friend wanted to buy the ex grow op house and he couldn't find a way to ever get a mortgage on it. And he works at a bank selling mortgages. So while some houses may be trashed by grow ops they are all assumed to be trashed and there is no way to remove the black mark from the property.

Shouldn't that drop the price until someone can buy it outright? You know, supply and demand? What's keeping the price up? Is the previous owner unwilling to sell so low?

the 1.5 million dollar house was for sale for 400,000. I'd say the price did drop. The bank had taken the house back from the owner because he was so far underwater on it and it was the bank selling it at 400,000.