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South Dakota
The migration of America has taken hold on South Dakota. But an era of slow growth and far less than double digit appreciation is bolstering this state. By all indications South Dakota may escape a direct hit from the national real estate recession.
That isn’t to say South Dakota real estate markets won’t be influenced. These days, sales have slowed since loans are not being made as freely, and prices have declined.
More and more Americans are moving to warmer climates and cold South Dakota has felt the blunt. As a consequence South Dakota has seen its population decline amid a national real estate boom that has troubled the majority of the nation.
The mortgage crisis in South Dakota doesn’t roam with the Buffalo along the prairies, but it is beginning to have an unfamiliar impact on the state’s real estate markets. Subprime mortgages have been blamed as the culprit of the mortgage mess, but conventional mortgages are becoming an increasing problem in America’s mortgage crisis. Fortunately for South Dakota subprime mortgages were unpopular here.
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| City |
Forecast |
| Sioux Falls |
− 3.4% |
| Rapid City |
− 2.6% |
| Black Hills |
− 3.7% |
| Piedmont |
− 2.7% |
On the banks of the Big Sioux River in Sioux Falls the housing market has slowed, but a vibrant local economy and strong local political leadership has kept Sioux Falls out of a depressing real estate market. The state’s largest city has seen home sales slow, but not to a major degree.
Sioux Falls has seen growth since the early 1990's. However, without strong velocity or rapid home sales, Sioux Falls will slumber through 2008 with little significant change, deflating just 3.4% on the average home.
South Dakota is a rare kind of place in America, where neighbors depend on neighbors for comfort even though in rural areas your nearest neighbor might be 60-miles away.
In Rapid City new businesses have moved to the area producing a stable job market in retail and science positions. Agriculture and the tourism industries also give South Dakota an extra boost. The real estate market has grown with many new homes.
As the gateway to the Black Hills, Rapid City is the state’s second largest city and has seen growth for the past five years. But the national economic down turn will have an impact on this slow growth climate sending the housing market into a flattening stage in 2008 and 2.0% lower on the average home.
Just north of Rapid City, Piedmont has seen growth with new housing developments, but the Piedmont market is slowly moving, and there won’t be better times ahead for quite some time, according to the Housing Predictor forecast, deflating 2.7% in 2008.
The Black Hills of South Dakota were growing with newcomers, while more rural places are losing population to Sun Belt states. The Black Hills saw a micro-market real estate boom for a few months during the height of the national real estate boom only to quickly slow. Black Hills will see 3.7% in depreciation in 2008.
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