Great Job Markets Usually Mean Great Housing Markets,

Here’s a link to the best 30 job markets in the nation, according to the federal Bureau of Labor Statistics.

I wouldn’t be surprised to find that they include some of the 30 best housing markets in the nation as well.  By that, I mean housing markets where the current prices are relatively low, and where many people want to live (which means prices will be going up).  These markets are ripe for you and me.  Markets where a buy-and-hold investor can earn a solid profit over multiple years, and a flipper will likely find good deals.  Markets, in short, where we can make money.

These are a good sign of a coming housing boom.

And why is that?  Because job growth is a leading indicator for housing growth.  New people are moving into these towns, looking for work and finding it.  Now they need a place to live.  And there are other factors that make a housing boom in these towns more likely.

Why will these cities see a housing boom?

First, business attracts business.  The top job market, in this study, is Bismarck, North Dakota, which is the state capital of North Dakota.  While the state government is Bismarck’s biggest employer, there are also several big private companies, including Bobcat (they make those cool little tractors and other construction equipment) and MDU Resources (a fast-growing and forward-looking energy utility).

Knowing that big manufacturers and blue-collar employers are happy in Bismarck makes me think that others will be heading there soon as well.

Second, business is attracted by a good work force and a good governmental climate.  I don’t know for sure, but I’ll bet Bismarck is well known in the Midwest for both.  These are also positive factors for anyone looking to make a housing investment.

Third, you are not the only person reading this blog post (I hope!)  Lots of investors also watch the job market closely for clues as to the housing market.  My guess is that the folks at the chambers of commerce in Bismarck, and in Casper, Wyoming (#2), Logan, Utah (#3), Sioux Falls, South Dakota (#4), and so on are very busy answering calls from out-of-staters this week.  Some of those other folks will be hot to invest either in job or housing creation.

That means two things.  The first is that the good times in Bismarck, Casper, Sioux Falls, and so on are likely to continue for a number of years.  There is little chance that the bottom will drop out any time soon.

This also means there is a good chance that property in Bismarck and the other towns on this list will get bid up pretty quickly.  Better to be early than late in that case.

Must I remind you not to trust me?

Now please, please, do your own research.  I haven’t spent a ton of time on this yet, and I may find something very unpleasant about Bismarck or one of the other cities on the list.  Something that would significantly reduce the potential for growth in these markets.  Anyway, you already know enough not to trust me.

As you look through the list, notice that almost every one of these cities is far from the traditional job growth engines and population centers of our country.  Only one, Portsmouth, NH (where I happen to live) is in the Northeast.  There are a couple in Virginia and West Virginia.  Most of the others are in what I think of as the Far Midwest – west of Chicago, east of the Rockies.  You’ll also see a number of college towns and state capitals.  College towns and state capitals rarely have the huge upheavals you see in other cities (where a big layoff can reduce population by 80% in a year).

But if you are willing to invest out-of-state, or if by chance you live near one of these hot markets…

And if you have the money to invest right now…

And if you have the time to do the research…

And if the opportunities right around you don’t look so sweet…

…Why not take a look at some of these cities?

Start with Google, Wikipedia, Google News and Realtor.com.  Get in touch with local officials.  Talk to local brokers and property manager.  Consider a visit.  (I think it would be insane to buy property in a town you have not visited.)

Last thing: these are Metropolitan Statistical Areas (MSAs) centered around a city.  So even though Bismarck is #1 on the list, the best opportunities may actually be found in some suburb of Bismarck.  Similarly, there is probably some suburb of Bismarck (or some of the other cities) you wouldn’t touch with a ten foot pole.  Hey, I can tell you the towns around Portsmouth, NH, that you should avoid, since I live there.

And let me know how you made out!

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