Boom towns are springing up all across the country as the term “fracking” almost becomes a household name.
Few would argue that America needs to be more energy independent, and in that search for “black gold”, the mining companies have hit upon the Bakken Basin which covers a good deal of Montana and North Dakota, and extends into Canada.
Buying in a mining town is dangerous…but can be very profitable. Dangerous because when all of the initial mining activity is taking place, it requires a large number of individuals to get the job done. When the oil is flowing nicely, however, workers move on to another oil strike, leaving fewer people behind to “watch the store”.
Right now, the town of Minot is building residences as quickly as they can, but the demand is still outstripping supply. This is a good thing for buyers as their property values will continue to rise, and for investors because rents will as well, but as is the case with any purchase, the quicker you obtain 100 percent equity, the better – especially when growth has been contingent upon mining activity.
Trulia.com reflects the rising prices in Minot, revealing that home prices as of June 6 were at an affordable $251,427, reflecting an increase of 3.8% from the week before, and an increase of 2.9% from the week before that.
The massive influx of mining workers has put a strain on Minot’s infrastructure, as roads, community services, restaurants and hotels built to accommodate a smaller population are struggling to keep pace.
Governor Jack Dalrymple talks about the boom’s impact on North Dakota’s oil-rich communities. “They are definitely in a period of growing pains right now, and I mean pain in the literal sense of the word. It’s a boom. It’s a rush. That certainly isn’t pleasant for everybody, but I think most people realize that once they kind of get over this period of furious drilling activity, it’s really going to be a great thing for that part of the state.”
North Dakota has a sparse population. Many individuals living in this part of the country are rugged, independent minded people. They choose to live in remote areas because it suits them.
A vital question they need to ask themselves is will they let the influx of money – which will certainly leave after a period of time – change who they are? Would it change you?