I arrived in Dickinson, North Dakota, in May of 2011, stayed for eight months, then came back in May of 2013, and have been here since. I have become friends or acquaintances of several long time residents who are now in their 60s, “DS”, “IB”, and “CL”. I have to use these initials to protect their identities. Each of these individuals had business and social dealings with each other, so I have been able to cross check what each of them has told me.
In approximately the mid 1980s, there was an oil boom in Dickinson. Many local people were making a great deal of money. “CL” was about thirty years old, and at this time he bought a new truck, a new car, and a manufactured home in a twelve month period. His friends and acquaintances did the same thing. Within a few years, “CL” had to move back in with his parents, and had to go to work at a grocery store, because that was the only job he could get. The same thing happened to his friends, they went from having their own homes and new cars, to living in apartments and driving beaters. The oil field jobs went away, and it was hard to find even a low paying job in Dickinson.
Within a couple of years of the oil field jobs going away, property prices had fallen tremendously in Dickinson. “IB” and a business partner were able to scrape enough money together to buy some warehouses on several acres of land for about $6,000 each, even though it was very hard to earn money in Dickinson at that time. “IB” and his business partner had worked in the oil field and they strongly believed that eventually the oil drilling would have to come back to Dickinson. “DS” was about forty years old, and he was able to buy 30 acres of land that nobody wanted for about $20,000.
When I got here in 2011, “IB” and his business partner were getting about $30,000 per month in rent from the different warehouse buildings that they had bought, I was told. Once I found out which warehouse buildings they were, and what they were charging for rent, that dollar amount was approximately correct. “DS” had his property for sale for about $3 million.
Both “IB” and “DS” were stressed individuals. They had had to go through a lot to buy their properties when money was scarce, and hold onto their properties through bad economic times, over about twenty years. Nobody knew when or if the oil drilling would come back. If it would have been a sure thing, real estate prices would not have gone down, and everybody would have bought property.
Rather than this being a lesson in investment, I want this to be a warning. The oil drilling came to Dickinson in the past, everybody was making money for a few years, and then the oil drilling went away, leaving many people broke. Many people spent the money they had made very quickly because they thought that their jobs would last longer than they did, and that they would have the chance to pay off everything that was bought on credit: cars, motorcycles, boats, homes. Keep in mind also that real estate prices dropped tremendously within a few years. There were very few jobs in Dickinson then, and the jobs were low pay. Do not fail to understand the lessons of the past, please try to remember what has happened before and plan accordingly.