The presidential campaign rhetoric is kicking into high gear. Texas Governor Rick Perry says he’s a job creation whiz. His detractors say it’s just dumb luck because he happens to govern a state with oil and gas under the ground. But no one is denying there are more jobs happening in Texas than any other state.
Meanwhile, no one is talking about Jack Dalrymple.
Jack Dalrymple. He’s the governor of the state with the lowest unemployment rate in the USA. And he’s the Governor of North Dakota.
North Dakota? Really?? Do you even know where North Dakota is? (Hint: It’s just above South Dakota, if that helps.)
According to a recent article by the Associated Press, “Booming oil, agriculture and manufacturing industries have helped the state keep the lowest unemployment rate since November 2008.”
Wow. Oil, agriculture and manufacturing is the magic formula. Who knew?
So what’s the lesson for real estate investors?
Well, if you believe like we do, that the best tenants are those with jobs, then paying attention to what, where and why job are happening is obviously important.
In this case, North Dakota’s experience is affirming what we’ve already come to realize: markets with industries that are strongly linked to the geography are less likely to move off shore. Oil and agriculture fit that bill.
So when you’re researching prospective markets to buy rental property, pay close attention to which businesses are “primary” (pulling money in from outside the area) and how “linked” they are to the geography. And of course, those businesses need to provide the kind of jobs that renters need. Match your property choices and price points to what the employees of the local businesses can best afford.
If that all sounds like common sense, that’s because it is. But as the legendary football coach Vince Lombardi always reminded his championship teams, winning is matter of mastering the fundamentals.