The April snapshot of economic activity in Greater Waco was not a flattering picture, as the sale of homes and vehicles dropped, employment softened and general construction fell flat.
For the second straight month, the Greater Waco Economic Index prepared by Amarillo-based economist Karr Ingham has declined, dipping from 125.4 in March to 125.2 in April.
Putting the best face possible on the findings, Ingham wrote in his summary, “the declines thus far in 2017, for the most part, are simply lower numbers this year compared to strong numbers and sharp year-over-year increases in April of a year ago.”
Ingham uses data dating to the year 2000 to gauge factors including spending, construction and employment. He prepares a monthly report for the First National Bank of Central Texas and the Tribune-Herald. The Greater Waco Chamber of Commerce’s Whitney Richter presents the findings to invited business leaders.
Richter said the two-month slump in the GWEI should present no cause for alarm, and Waco’s economy generally has performed well the past 60 months, with dips few and far between.
General taxable spending in April fell by nearly 4 percent compared to the same month last year, and spending through the first four months of the year “is essentially flat,” Ingham said.
The cities for which sales tax is aggregated and analyzed include Waco, Bellmead, Beverly Hills, Hewitt, Lacy Lakeview, Lorena, McGregor, Robinson, West and Woodway.
The sale of single-family homes in Waco fell from 271 closings in April of last year to 213 this year, a decline of more than 21 percent, according to Ingham’s figures.
Ingham also reported that, through April, 746 homes had been sold in Greater Waco, a drop of more than 6 percent from the 797 sold during the same period last year.
But Richter said the local housing market has become so heated that homes often get sold before they appear on the Multiple Listing Services, “so those transactions are not captured.”
She said Waco’s home inventory has dropped to 2.3 months, which means it would take 2.3 months to sell all homes on the market at the current rate of sales.
“That is very low, next to nothing. There have been times when our inventory was eight or nine months,” she said. “This is definitely a seller’s market, but some homes are not moving simply because would-be sellers don’t know where they would find another house.”
Demand for homes continues to push prices upward, with properties sold in April carrying an average price of $186,306, which is 9.7 percent more than the $169,769 average last April.
Construction of new homes in Waco was among the few bright spots in Ingham’s report. It showed permits were issued to build 48 homes in April, a jump from 35 the same month last year. For the year through April, 199 permits were issued, up from 123 in the same time last year.
Kay Vinzant, executive officer for the Heart of Texas Builders Association, said the numbers would become even more impressive if they included home construction in Waco’s suburbs and in the rural areas of McLennan County.
Ingham reports only on construction in Waco city limits, saying information is not always available in other areas.
Sales of new and used cars in April fell 12 percent from last year, while year-to-date spending through April has increased a modest 1.3 percent from the first four months of 2016, “which in turn was up by more than 11 percent compared to the first four months of the previous year,” Ingham said in his report.
“The industry is flat, but remember where we were a few years ago,” said Ted Teague, general manager of the Allen Samuels Dodge Chrysler Jeep Ram dealership.
Teague said sales in April suffered in comparison to those in the same month last year, “but last April was the best sales month we’ve ever had. We’re on pace to sell 270 units in May, which is a 9 percent increase over May a year ago.”
Permits issued for general construction in April totaled $17.7 million in value, well below the $66.8 million of April 2016.
But Ingham said the April 2016 permit valuation total “was the highest on record for the month of April and was up by over 80 percent compared to April of the previous year.”
The Waco economy created 2,100 jobs over the past year, representing a growth rate of 1.8 percent. That falls short of the 3.7 percent year-over-year growth rate of April 2016 and the addition of about 4,200 jobs over the preceeding 12 months.
The jobless rate in April stood at 3.9 percent, up slightly from the 3.6 percent rate in the same month last year.
Several representatives of local businesses attended the presentation of the index and commented on their sectors.
Gayle Kiger, general manager of KCEN-TV, which broadcasts to Temple, Waco and Killeen, said the success of the station in generating revenue “is tied to the car business. When they are doing well, we are doing well.”
He said KCEN-TV is enjoying a good year compared to many of its 46 sister stations owned by Tegna Inc., meaning the local economy is performing well.
Mike Mosul, general manager of the Baylor Club in McLane Stadium, said the venue continues to attract new members, showing a net increase of about 120 so far this year.
“Last year we were No. 1 in our division of ClubCorp, in terms of growth,” Mosul said. “People keep coming, and we keep taking them.”