Waco, TX

NeutralTier 1CBSA 47380Compare

Risk Rank: #185 of 273Month: 2026-08Score change (12m):↑ +5

45score

Composite risk percentile vs 273 metros (higher = higher risk)

Executive Summary

Waco's housing market shows average risk, ranking 185th of 273 metros. The market recently entered Recovery. Current conditions are balanced with stable liquidity. Early signs of stabilization — conditions may favor patient buyers.

Waco experienced a market correction from mid-2025 through late 2025. The market is currently recovering.

Inventory is roughly flat (-0% YoY) with homes selling at a normal pace — a balanced market.

Rent growth is roughly keeping pace with price appreciation, suggesting valuations are not stretched.

Cycle Phase

RecoveryExpansionHypersupplyRecession

1 month in current phase

Market conditions are rebuilding after a correction period

Key Dynamics

Risk is primarily driven by affordability and permits per capita, while price momentum provides the most support.

Top Drivers

Affordabilityp91

Mortgage payment / income

Permits per Capitap59

Permits per 1,000 residents

Employmentp43

12-month employment change (risk inverted)

Market Signals

Inventory is roughly flat (-0% YoY) with homes selling at a normal pace — a balanced market.

Liquidity

Stable↓

Active Listings YoY

-0.1%p48

Days on Market YoY

-15.3%p21

Months in status1

Data through Aug 2026

Valuation

Balanced—

Rent vs. Price Growth

+1.8%p85

Months in status1

Data through Aug 2026Rent growth vs price growth (rent support). Note: Affordability and Valuation measure different structural dimensions and can diverge.

Factor Details

Lower riskHigher risk

Low RiskBelow AvgNeutralElevatedHigh Risk

Price MomentumLow Risk

-0.8%p3

12-month HPI change — higher = overheating

Permit GrowthBelow Avg

-8.0%p33

YoY permit change — higher = supply pressure

Permits per CapitaNeutral

4.93p59

Permits per 1,000 residents — higher = overbuilding risk

AffordabilityHigh Risk

0.36p91

Mortgage payment / income — higher = more burdened

EmploymentNeutral

+0.6%p43

12-month employment change (risk inverted)

MigrationBelow Avg

+$30Kp39

Net AGI migration (risk inverted)

National Context

Credit Conditions

Credit Regime

Stable—

Healthy recovery. Credit is flowing normally and transactions are steady — conditions favor continued rebuilding.

Bank Lending Standards

+0.0Normal

Rate Change (YoY)

+11 bpsNormal

Mortgage Risk Premium

+196 bpsElevated

Stable for 10 quartersData through 2026-Q3

Supply Pipeline

Supply Regime

Accumulating—

Supply pipeline is building up while credit remains available. New units are accumulating in the system — watch for delivery pressure in coming quarters.

Pipeline Ratio

0.89Elevated

Completion-Permit Divergence

-19.2 ppNormal

Accumulating for 6 quartersData through 2026-Q3

Local Signals

Metro Permit Activity

Permit Activity

Normal

YoY Permit Growth

-8.0%Within norm

Raw signal — not the composite percentile

Relative to 2016–2019 norms for this metro

Supply and demand are in equilibrium. No unusual activity on either side of the market.

Employment Concentration

Employment

Limited data

Largest SectorGovernment 31.3%

5 of 20 sectors disclosed · QCEW 2024 annual averages

Internal Structure

Waco's 3 counties show moderate divergence — McLennan County carries the most risk (Elevated) while Falls County anchors the lower end.

Moderate14.8Limited data

3 of 3 counties scored

Waco, TX shows Moderate internal divergence — some counties diverge meaningfully from the metro picture. McLennan County contributes the most structural risk (Elevated, driven by permit growth), while Falls County anchors the lower end (Low Risk).

Within-metro factor percentiles (0 = lowest risk, 100 = highest risk)

County	Score ▼	Band	Pop %	Price	Permits	Afford
McLennan CountyRisk Driver	75	Elevated	88.1%	0	100	100
Bosque County	62	Elevated	6.2%	100	50	50
Falls CountyStabilizer	12	Low Risk	5.7%	50	0	0

Score History

Month	Phase	Score	Price	Permits	Afford	Employ	Migr
2026-06	Rec	63	75	92	93	10	39
2025-12	Hyp	62	32	90	91	66	39
2025-10	Hyp	50	61	5	92	57	38
2025-08	Ress	40	34	5	92	29	38
2025-06	Ress	32	4	5	89	12	38
2025-05	Hyp	33	5	5	89	15	38
2025-04	Ress	32	9	5	89	10	38
2025-02	Ress	44	62	5	91	22	38
2025-01	Rec	45	76	5	91	16	38
2024-12	Hyp	43	52	5	90	30	38
2024-10	Hyp	39	12	5	90	47	38
2024-07	Ress	43	15	5	91	67	38
2024-05	Ress	36	10	5	91	30	38
2024-04	Hyp	36	11	5	91	26	38
2024-02	Hyp	33	0	5	88	22	38
2023-11	Hyp	36	6	5	92	31	38
2023-08	Hyp	40	30	5	94	27	38
2023-05	Hyp	45	50	5	93	38	38
2023-03	Ress	52	80	5	93	54	38
2023-01	Ress	54	71	5	93	72	38
2022-10	Ress	55	86	5	92	64	38
2022-07	Hyp	51	84	5	91	42	38
2022-06	Ress	50	79	5	90	40	38
2022-04	Ress	52	80	5	90	52	38
2022-03	Exp	48	86	5	89	28	38
2022-01	Exp	51	85	5	89	42	38
2021-10	Exp	46	76	5	86	26	36
2021-07	Exp	52	60	5	84	86	36
2021-05	Rec	55	66	5	84	97	36
2021-03	Rec	40	49	5	84	22	36
2020-12	Rec	39	53	5	96	7	31
2020-09	Rec	44	82	5	97	7	31
2020-06	Rec	41	63	5	97	7	31
2020-05	Exp	43	77	5	97	2	31
2020-03	Exp	49	92	5	97	24	31
2019-12	Rec	54	84	5	97	58	37
2019-10	Rec	54	84	5	97	54	37
2019-07	Rec	46	69	5	97	26	37
2019-04	Exp	45	56	5	96	33	37
2019-02	Exp	40	41	5	96	18	37
2019-01	Hyp	39	34	5	96	20	37

Data Vintages

Price (HPI)2026-Q2

Permits2026-08

Income2024

Employment2026-08

Migration2023