Low interest rates drive strong demand for homes

MOSES LAKE — The COVID-19 pandemic has not dampened interest in those seeking to buy a new home.

If anything, it has prompted a lot of folks to go looking for their next home.

According to the National Association of Home Builders’ latest Housing Trends report, interest among potential homebuyers increased substantially beginning in July: Around half of the roughly 1-in-10 American adults looking at buying this year moved from mere consideration to active planning.

That’s up from the 44 percent of adults at this time last year, the study found.

The biggest jump in interest came among millennials — adults aged 24 to 39 — and Gen X’ers — those aged 40 to 55.

“It’s definitely something we’re seeing,” said Jason Hall, one of the owners of Better Homes and Gardens Realty Gary Mann Real Estate in Moses Lake. “There’s an urgency because of the low interest rates.”

According to the website Bankrate.com, the average interest rate on a 30-year mortgate was 2.92% on Thursday. The actual interest rate a borrower may receive will depend on a number of factors, such as credit rating, house price and income.

Hall said in 2019, there were 793 home purchases in Moses Lake. So far, in pandemic-ravaged 2020, there have been 833 home purchases in the area.

“The number of buyers is very strong,” he said. “The inventory of homes is so light. Traditionally, there are 250-300 homes on the market at any one time, but right now, it’s as low as 35-45 on the market.”

Hall said demand is strong even for higher-end homes in Moses Lake, houses starting at around $450,000 to $550,000.

“We’ve never had that in this market,” he said.

According to the NAHB report, the time it takes the average homebuyer to find a new home has also increased, with 62% of homebuyers being actively engaged in the purchasing process for three months or more, compared with 58% this time in 2019.

Hall said the hot national and local home markets would at some point cool off.

“Rates can’t go much lower, but prices can continue to go up, which would diminish that advantage,” he said.

Charles H. Featherstone can be reached at [email protected].