Driven by general spending and outlays on automobiles, the Greater Waco Economic Index rebounded in June from a slight downturn in May and likely will continue to surge, according to a report released Wednesday by Amarillo-based economist Karr Ingham.
“The residential real estate market enjoyed strong growth in the second quarter, with sales and prices both posting significant year-over-year increases,” said Ingham, who prepares a monthly snapshot of the local economy for the First National Bank of Central Texas and the Tribune-Herald.
“Employment growth remains moderate but steady, and the unemployment rate continues to decline,” Ingham said.
Ingham’s report this week focused on both June’s performance and that of the quarter that includes April, May and June.
The index, which Ingham prepares using data dating back to 2000, climbed to 113.2 in June from 112.6 in May and 110.9 in June of last year.
Spending in Greater Waco rose 4.9 percent compared to the second quarter a year earlier, and spending in June eclipsed that of last year by nearly 11 percent.
Real spending, adjusted for inflation, has reached $1.1 billion through June.
“This important category of local economic measurement in 2014 is posting its highest rates of growth since the recession,” Ingham said.
Cities for which sales tax is aggregated and analyzed include Waco, Bellmead, Beverly Hills, Hewitt, Lacy Lakeview, Lorena, McGregor, Robinson and West.
Meanwhile, car lots and dealerships around Greater Waco continue to lure buyers at an impressive pace, Ingham said. Spending on new and used automobiles rose 5.3 percent for the quarter, to $126 million, compared to the same time period in 2013, which was 10.7 percent higher than the previous year.
In June alone, auto spending locally was up by nearly 7 percent compared to June of a year ago, which was up 20 percent from June of 2012.
Money talks when buying vehicles, and more people have the means to make deals, according to Ingham’s report.
The local economy has created about 1,900 jobs the past year, and year-over-year employment growth was purring along at 1.8 percent in June.
Construction of single-family homes continues to trend lower, with the number of new permits issued down by 25 percent for the quarter and 12.6 percent for the first half of the year.
But the residential real estate market is purring. In fact, the 719 homes sold during the second quarter falls only eight short of the all-time record of 727 sales in the second quarter of 2007, which was the year the market peaked locally and before recession began to take its toll nationwide.
The average home sales price in the second quarter, $150,979, was nearly 5 percent higher than that of the same period last year.
During a discussion Wednesday among business leaders who attended a news conference on the index, it was reported that Waco actually has a shortage of empty buildings ready for occupancy by investors or new companies looking to locate in Waco at a time when the local economy is performing well.
Also, Jim Haller, an executive at the First National Bank of Central Texas who moderates the news conference, said Waco benefits from being located on Interstate 35.
“Wouldn’t Bryan-College Station, for example, be real thrilled to be right on I-35,” he said, with a laugh.