By David Bailey

MINOT, North Dakota (Reuters) - The snow has not yet begun to fly in Minot, a good thing for exhausted North Dakota residents in a race to house thousands of people displaced by a massive flood before the harsh winter sets in.

Four months after a record flood on the Souris River left about 11,000 people -- more than a quarter of Minot's population -- effectively homeless, the temperature is beginning to drop and many of the displaced remain staying with friends, family, in hotels or other shelter.

"We have gone from a shortage, to a critical situation to what I would consider today nearly a crisis situation," said Mike Anderson, executive director of the North Dakota Housing Finance Authority that serves affordable housing.

The state's booming oil sector created a critical housing shortage in the region even before the Souris, or Mouse River as it is known in the United States, roared over its banks and forced the evacuation of 4,100 houses in Minot and 1,000 in nearby developments and cities such as Burlington.

Federal officials hope to have everyone who needs temporary housing into it by late October or early November, up to 2,400 units grouped in community sites or on private property.

As of Wednesday night, about 45 units were occupied and more than 110 in place and being readied at community sites out of a planned 950. More than 780 units were occupied on private property out of more than 1,000 that had been placed.

Kristi Bertsch, who moved into a unit this week with her husband Jon, three children aged 4 to 11 and two small dogs, said it would help to have their things closer at hand, but was concerned about how well it would hold up over the winter.

"The doors, you can see the daylight coming through so that is not a good sign," Bertsch said. "You can have 80 mile-per-hour winds here in the winter time and as cold as it gets that is going to be a lot of cold coming in."

The first freeze in the area this year was in mid September and the average low temperature by November 1 is in the 20s.

RUNNING AT FULL STEAM FOR MONTHS

The housing is "rated for northern climates," FEMA said.

The rectangular units stand up off the ground surrounded by aprons with wooden steps, white siding and shingled roofs. They have bedrooms, living and kitchen spaces and bathrooms.

"We are concerned about how they will hold up, especially how the water and sewer is going to hold up," Minot Mayor Curt Zimbelman said.

Ward County Commissioner Jerome Gruenberg warned federal officials the units could have freezing problems and workers had gone back to reinsulate skirting, water piping and other sections. He also said the housing process could go faster.

"It is going to get pretty nasty around here, it normally does," Gruenberg said. "We are used to it. We live with it, but people are getting anxious to get in before that hits."

The flood hit mid summer and water sat for weeks, leaving a short window to set up housing and make repairs. For months many residents have worked jobs all day and at their damaged houses late into the night, running on adrenaline.

"The best way to describe this community is utter fatigue," said Lisa Clute, a state health department district executive officer who lives in Minot. "We are just tired."

In a year when tornadoes killed hundreds of people in Missouri and the southeastern United States, residents were thankful there were no reported flood deaths in Minot. They hoped, though, that the Souris flood would not be forgotten.

"It was a challenge to get evacuated, it is nothing compared to rebuilding," Clute said.

PICKING UP THE PIECES

About 61,000 tons of debris was moved to local landfills, or enough material to create a football field-sized block 10 stories high under a program overseen by the U.S. Army Corps of Engineers, spokesman Patrick Moes said.

Many houses have been stripped to framing to dry out, some have visible construction and many have been left untouched.

For residents rebuilding now, skilled workers are in short supply, delaying repairs and raising the cost. Rents have begun to rise sharply in the last few weeks, local officials said.

Jaimie McMullen, a Minot State University professor, counts herself among the luckier residents. Many homes sat in water to the eaves, while water reached three feet on her first floor.

"First it was gutting, than it was cleaning, sanitizing and drying and now the rebuilding effort," said McMullen, who stayed with a neighbor's friend for weeks.

McMullen, 29, has spent her life savings and taken on a small business administration loan in addition to her mortgage, but the smelly sludge is gone and her house is nearly ready.

With repairs estimated to cost up to $80,000, McMullen leaned heavily on an uncle who worked on her house for weeks.

Across town, masked workers stripped rotted debris from Don Thomas's rental property, hauled it outside in plastic garbage barrels they lifted overhead and emptied into a dumpster.

Thomas planned to seal up the house after three weeks work and then do more restoration work next spring.

"It came about 4 inches from the living room ceiling," said Thomas, who has owned the house since the late 1970s. "The ceiling is dry -- everything else needs a lot of cleanup."

A LONG ROAD AHEAD

The next big step in the recovery is a flood control plan now in the works to lay out flood defenses and where homes might be bought out, allowing owners to decide whether to repair, rebuild or abandon properties throughout the valley.

The recovery of Grand Forks, North Dakota, from a devastating flood and fire in 1997 took about 10 years. Grand Forks incorporated park space and flood protections that left the city dry during Red River flooding this year.

"People will start to feel more relaxed the more progress we see on that," the state's flood recovery coordinator, Major General Murray Sagsveen, said of a flood control plan.

In Minot, traffic lights and street lamps remain out and sinkholes are forming in some streets, raising concerns the sewer and water systems may have more damage than thought.

Several Minot school buildings were shuttered due to flood damage, and displaced students attend classes at the city auditorium, a local church and in 65 portable classrooms. Those temporary measures may stay in place through next year.

North Dakota state lawmakers plan a special session next month that in part is expected to consider an extension of Minot sewer and water lines to address the housing shortage.

The Bertsch family gutted its Burlington home and put it up for sale, but hopes to move into a new home in the area before the end of winter, Kristi Bertsch said.

"We bought some land, we are going to build there," Bertsch said. "As long as we get our basement dug before the ground freezes ... otherwise we won't move until spring."

(Reporting by David Bailey; Editing by Jerry Norton)