Almost 250 single-family homes changed hands in December, an all-time high. Home sales helped push the Greater Waco Economic Index into record territory for the month and helped it end 2017 on a high note despite lackluster showings in employment growth, spending and general construction.
The uptick last month “was virtually entirely the result of sharply higher numbers in the housing components, both new construction and existing home sales,” said Amarillo-based economist Karr Ingham, who prepares the GWEI using data dating to 2000.
The First National Bank of Central Texas and the Tribune-Herald sponsor preparation of the report, which Ingham released Wednesday. Raw numbers show the GWEI improved to 126 in December, up from 125.5 in both October and November, and from 124.8 in December 2016.
Ingham said Greater Waco saw the sale of 248 homes in December, a month in which real estate agents typically experience a slowdown. That easily eclipsed the 190 sold in December the previous year.
The 676 homes sold during the fourth quarter also set a record. The impressive closing performance pushed total sales for the year to 2,778, a fractional increase from 2,749 in 2016, Ingham said.
Demand for homes in Greater Waco continues to put upward pressure on prices, with the $194,179 average in December up from $174,665 a year earlier, said Kris Collins, senior vice president for economic development at the Greater Waco Chamber of Commerce, who presented details of the report to several business and community leaders who met Wednesday.
Collins said home prices likely will stabilize in 2018 and beyond as development continues on several new and planned subdivisions, including the 1,500-lot Park Meadows neighborhood in far West Waco, near Hewitt, being created by national builders D.R. Horton and Stylecraft.
The city of Waco last year issued permits to build 514 single-family homes, a 25 percent increase, and that figure does not reflect permits issued by the homebuilding hotbeds of Hewitt, Lorena or Woodway, Collins said.
Hewitt City Manager Adam Miles said a waiting list is forming for the $30 million apartment complex called The Icon at Hewitt, which Case & Associates Properties of Tulsa, Oklahoma, is building near the new municipal center.
“There will be 400-plus apartment units this time next year on land that was vacant until a couple of years ago,” Miles said.
The jobless rate in the Waco Metropolitan Statistical Area, which includes Falls and McLennan counties, continues to dive, hitting 3.4 percent in December, the lowest in the history of the GWEI.
However, the number of people employed actually slipped fractionally in December, and for the year increased a modest 0.4 percent.
Ingham said the unemployment figures are preliminary, and data suggests they could be revised upward in March.
Collins, who also recruits industry, said the chamber likely will make multiple announcements about new employers choosing Waco for expansion during the first quarter of 2018.
Still, in response to questions, Collins acknowledged Greater Waco is failing to attract some national prospects because it has no speculative building of 100,000 square feet or more to make available.
“Too, talent remains a piece of the puzzle we must address,” Collins said. “The chamber, local foundations and other partners are taking steps to create a labor pool that meets the needs of industry. I do believe we can create a talent pipeline, but we also know this is a national issue.”
Automobile spending declined in November but rebounded in December, with outlays increasing 3.9 percent year-over-year. For the fourth quarter, they grew by 4.5 percent, and were up fractionally for the year.
Mark Stewart, general manager of Jim Turner Chevrolet in McGregor, said competition has become fierce among local dealerships, “and instead of growth, we pursue market share.”
He said Central Texas in 2017 became a “cash market,” with buyers at his store relying more on personal resources than financing.
Stewart said research shows consumers scouting for deals visit 19 online sites before visiting dealers’ lots, and the number of dealerships visited before striking a deal has declined from four to an average of fewer than two.
General spending in Greater Waco increased only 1.5 percent in December, “was essentially flat” during the fourth quarter, and improved 0.5 percent for all of 2017, Ingham said. Those figures are based on sales tax receipts in Bellmead, Beverly Hills, Hewitt, Lacy Lakeview, Lorena, McGregor, Robinson, West, Woodway and Waco.
The general construction sector in 2017 continued to lag behind its performance in recent years, but “the numbers are not terrible,” Ingham said. “The 2013 annual total, to which these succeeding years are being compared, was the year in which Baylor University’s new football stadium was permitted, somewhat skewing the results thereafter.”
The annual total of $305 million in permitted projects “is generally on par with most of the history of the GWEI,” he said.
“The past year was clearly a year of general economic improvement, though again the ideal would always be higher rates of growth in general spending and employment,” Ingham concluded.
During a question-and-answer session, local business leaders provided observations about their areas of expertise.
Kary Lalani, president of Waco-based Lalani Lodging, said construction continues on the 111-room Hilton Garden Inn going up at Legends Crossing. He said the fundamentals of the Waco economy appear strong as they relate to supporting lodging establishments.
Lance Neumann, general manager of Capt. Billy Whizzbangs, a 41-year-old burger emporium, said sales increased 30 percent last year, due primarily to increased catering business and the popularity of his food trucks, one of which he has stationed near Magnolia Market at the Silos downtown.