Then and now

MOSES LAKE — Alan Heroux has seen Moses Lake’s real estate changes at first hand.

“I have always just stuck with Moses Lake,” Heroux said. “I've always figured that it's my market. I would typically refer somebody in Ephrata to an agent over there just because they know their area. I have very intimate knowledge of Moses Lake and that's where I've always tried to stay ... I feel that you need to work with a broker that is very familiar with the area that they're in. That's the wisest thing a seller can do – or a buyer for that matter.”

Heroux, who is currently with Realty Executives Grant County, got his start in 1989, and he’s seen a lot of change in that time.

“My first sale was a view lot, a vacant piece of property in a residential neighborhood that sold for $8,500,” he said. “And that same lot today is $100,000 easily.”

For comparison, a lot in the then-new Cove West development would have run $25,000 in 1989, Heroux added. A vacant lot in that development sold in November for $84,900, according to real estate website Zillow.com.

Real estate prices took an upswing between 1991 and 1993, he said, some properties doubling in value during that time. But that was just a little shift compared to the upheaval we’ve seen recently.

“In real estate, when we look at a piece of property and we try to put a value on it, we use what's called the comparative market approach,” Heroux said. “You look at a 1,000-square-foot house, you look at three other 1,000-square-foot houses, and you say all right, buyers are willing to pay $100,000. That's what the value of this house is, $100,000. And I used the same comparables between ’95 and ’99. I don't think the market changed much at all. So the market went up in the early ’90s, and went flat in the late ’90s. Then again, in the early 2000s, there was a little bit of appreciation and it went absolutely nuts in 2006, 2007.

“And then, of course, it crashed in 2008 and totally destroyed the world as we know it.”

But that’s still small potatoes next to the current upheavals.

“The last two, three years have seen absolutely unprecedented double-digit appreciation on homes,” Heroux said. “You know, normally if we see a couple percentage points a year, that's a good appreciation. But the last couple of years have been double-digit. It's been huge.”

The boom has been fueled by equally unprecedented conditions, Heroux explained.

“What I think has happened is, interest rates were at an all-time low. And they were driven down, driven down, driven down, which increased the affordability of homes to people. And then COVID hit, and everybody started working from home. And they realized, ‘Wow, I don't have to live three miles from the company that I worked for in Redmond; I can live pretty much anywhere and still work for the same company.’ So we've seen a lot of people that are working from home, at this point, move out to rural areas like Moses Lake and be able to buy a lot more home because they're not paying big city prices, but they're still getting paid big city wages.”

The market will probably adjust itself back in the long run, Heroux explained, as some people go back to work in their old offices and some companies embrace remote work. Either way, he said, it probably won’t be as drastic an adjustment as in some other areas, because of the nature of the Moses Lake market.

“We're always behind the rest of the world,” he said. “I've seen this cycle multiple times before, so it's not a new thing. The California market is always nuts, people are paying way too much for property. So somebody pays too much for a house there, those people go, ‘We're getting out of California, let's move to Seattle.’ They go to Seattle with this big chunk of money, pay more than the market would bear for a house in Seattle. And then the folks from Seattle say, ‘Well, we're getting out of Seattle, we're gonna go to Moses Lake’ and then come over here and pay more than the market will bear for a house here, because they can afford to. And so we're always behind, because other markets have to do what they do before it hits Moses Lake. And that has benefited us in almost every downturn in the real estate cycle, because we don't get the massive, huge appreciation numbers that the rest of the world does, typically, because we're behind. So when California starts to crash, it's a domino effect. But we haven't had the massive appreciation, so we don't have the ups and downs swing, like other places in the country do.”

Heroux didn’t have a lot of predictions for the near future. The law of supply and demand still prevails, and he suggested that rising interest rates could put homes far enough out of reach for ordinary buyers that sellers will have to cut prices to something more affordable. But ultimately, it’s up in the air.

“The biggest question is, ‘What's the market gonna do?’” he said. “And the answer is, ‘Who knows?’”

Joel Martin can be reached via email at jmartin@columbiabasinherald.com.