Prices rose nearly everywhere, even in areas once considered reliably affordable.

For a brief window, record-low interest rates gave many first-time buyers a shot at homeownership.

But by 2022, rising mortgage costs and tight inventory reversed those gains.

housing North Dakota

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Oil booms, pandemic disruptions, and policy changes all left their mark.

Strong Urban Demand

Despite higher prices, demand in urban markets was strong.

Homes in cities tended to sell relatively quickly, especially during the post-2020 housing boom.

rural North Dakota

In fact, by 2021 many homes in cities would go pending in just over a month on average.

Declining Affordable Inventory

Another trend in urban North Dakota was the decline in affordable listings.

However, rural areas have not been immune to price increases.

North Dakota condo

The most dramatic example is North Dakotas oil-producing region in the northwest (around Williston).

During the oil boom, that regions average home price skyrocketed increasing 372% between 2010 and 2020.

Rural Market Activity

From 2018 to 2023, rural housing markets continued to evolve.

North Dakota house

Despite this, the years 20202021 brought a statewide surge in homebuying demand that also touched rural markets.

By 2021, that share had fallen to 69% of rural sales under $250k.

Most owner-occupying households live in this punch in of housing.

North Dakota aerial view

During 20182023, families continued to prefer buying single-family houses, whether in cities or small towns.

These include everything from older starter homes in town to newer suburban-style houses.

They are more commonly found in urban areas like Fargo or Bismarck.

house buying north dakota

For example, in downtown Fargo there have been condo developments, and Bismarck has some townhome communities.

North Dakota has a number of mobile home parks and rural properties with manufactured homes.

They are more common in rural areas or on the edges of cities.

north dakota houses

Downsizing Patterns

At the same time, another segment of the population was downsizing.

Nonetheless, some did choose to downsize during 20182023.

The trend in North Dakota has been that downsizing is gradual not a huge wave, but present.

In North Dakota, second homes are often lake cabins or vacation properties.

Overall, second homes remained a minor trend for in-state buyers, mostly limited to those with sufficient means.

In rural areas it dropped from 91% to 69% over the same period.

This indicates a statewide shift where lower-priced homes make up a smaller part of the market than before.

For homes under $150k, the average age is over 60 years.

Meanwhile, newer homes are usually priced higher.

Declining Homeownership

The decline in homeownership rates across income groups is another consequence of these trends.

As affordable inventory decreased and prices rose, fewer people in the low-to-moderate income brackets succeeded in buying homes.

The drop was especially sharp among households earning in the $50k$100k range traditionally the middle class.

Many of these families remained renters because they couldnt find or afford a suitable home to buy.

High prices and limited affordable choices played a big role in that.

Then, when the COVID-19 pandemic hit in 2020, the Federal Reserve cut rates to stimulate the economy.

As a result, 30-year fixed mortgage rates fell to historic lows, roughly around 3% in 2020.

Thats a huge difference in purchasing power.

However, this situation reversed starting in late 2021 and especially in 2022.

As inflation concerns grew, the Federal Reserve raised interest rates, and mortgage rates followed.

By mid-2022, the 30-year mortgage rate had roughly doubled to around 6%.

The impact of high interest rates in 20222023 can be seen in market activity.

Towns like Williston, Dickinson, and Minot saw a flood of workers and investment.

By 20182019, oil prices and production had stabilized to a moderate level.

The housing markets in the oil patch (e.g., Williston area) also stabilized.

The COVID-19 pandemic caused a sudden crash in oil demand in spring 2020.

Oil prices briefly went extremely low, and North Dakotas oil drilling activity plummeted.

This could have been a crisis for the oil-region housing market (potential for another bust).

However, this downturn was fairly short-lived.

By late 2020 and into 2021, oil demand and prices picked up again.

North Dakotas oil towns likely felt some whiplash: a brief slowdown and then a bounce back.

The housing trend in oil towns during 20212023 was gradual growth rather than explosive.

Williston and Dickinson continued to see home sales and new construction but at a controlled pace.

As discussed, the pandemic led to emergency interest rate cuts.

This made North Dakotans, like many Americans, reevaluate their space needs.

The pandemic did have a downside effect on housing supply it disrupted construction supply chains.

Lumber prices skyrocketed in 2021, and contractors faced delays getting materials.

This made building new homes more expensive and slower.

Remote work allowed some North Dakotans who were working in other states to return home and work from there.

From roughly 2008 to 2014, North Dakotas population and economy surged due to oil development.

In effect, North Dakotas housing market in 20222023 slowed down, but didnt crash.

Many of the newcomers were younger workers.

The 20082017 era saw a construction boom in North Dakota.

By contrast, 20182023 had a more constrained construction environment in the later years.

Overall, North Dakotas housing market in 20182023 was robust but difficult for those on a strict budget.