Lubbock Economic Analysis

Lubbock's economy remains steady entering the new year.

Retail sales continue to rise compared to last year, while tourism and overall construction are slightly down. Most commodity prices have declined except for cattle.

YTD retail sales are up 3%, while December 2025 sales rose 18% from December 2024, reflecting ongoing growth. New car sales increased 12%, and used car sales rose 9%.

Tourism is down slightly from last year, though only by a small margin.However, December tourism was up 40% from the previous month, driven by sports events and Christmas shopping. Airline boardings increased 5%, largely due to Texas Tech football travel.

Updated job numbers from the state have been delayed due to the federal government shutdown. Without official data-and with ICE related concerns - the job market may be weaker than it appears.

Total building starts were relatively flat year over year, showing a 3% decrease. Commercial building activity fell 39%, while residential activity rose 36%. Residential construction performed well, averaging 1,620 permits and totaling $578 million, up 20%. The median home price in December 2025 was $240,000, a 3% increase from the previous year.

Commercial construction continues to lag last year's levels. Lower interest rates - down 16% from last year - boosted residential activity, and expected future rate cuts could support additional residential and commercial growth.

Energy markets were significantly down YTD, with oil prices down 22% and natural gas down 28%. These lower prices should provide relief for consumers and businesses.

Most other commodities are down from last year, which benefits consumers but challenges producers.

Agricultural production has come off a relatively good year in 2025 but now depends heavily on much needed moisture to start new crops.Below normal winter and spring rainfall could reduce output.