North dakota leading us property market back to strength

It has been nearly a decade since house prices in the US crashed so spectacularly, but has the market recovered since then? Not fully, according to the experts.

The most recent National Association of Homebuilders (NAHB)/First American Leading Markets Index (LMI) found that just 18 per cent of markets (63 out of 351 metropolitan areas) in Q4 2014 matched or exceeded their normal levels of economic and housing activity.

In five small metro areas, the LMI rating scored more than 2.0, meaning that the market there was more than double the strength it was prior to the recession.

Two of those smaller metros are in the state of North Dakota, where the economy boomed throughout the recession years, thanks to the use of fracking technology to drill for shale oil. There, the housing market has experienced rapid and sustained growth, with the towns at the center of the oil industry enjoying substantial price rises.

As PWC's Emerging Trends in Real Estate, United States and Canada 2015 report observes, "most industry veterans would confirm that job growth is the key factor for filling office buildings and new housing, as well as the driver for improving sales at shopping centers and spending at hotels and resorts".

Robert Gavin, CEO of developer NDD Group, which is currently offering apartments in the area and constructing a hotel to meet demand, comments: "Although the overall US housing market is still moving towards operating at a normal level, the local market in North Dakota is well ahead of the curve. Demand from international investors for property here has been extensive – matched only by domestic demand from those in need of somewhere to live! North Dakota really is a modern day success story, particularly when considered against the backdrop of the country's overall economic and real estate performance during the past decade."