McAllen nears $100M sales tax milestone as total construction surges 40%

More than 1,300 people attended the McAllen State of the City address on Wednesday at the McAllen Convention Center, where city officials highlighted sales tax revenue growth, affordable housing, a bump in construction permits and economic growth. 

McAllen Mayor Javier Villalobos touted gains in sales tax revenue for the city’s coffers, hitting a new record of $99.9 million in 2025. That’s a 3.2% increase compared to 2024. The city is now about $18,000 shy of earning $100 million in sales tax revenue — a milestone leaders estimate they’ll hit in 2026. 

“I think that we keep on growing. McAllen, for whatever reason, this is where people come and invest. They come and spend, and that’s the way it’s been,” Villalobos told the Rio Grande Valley Business Journal. “We thought that post-COVID that it was going to be a little more difficult, but no, it has been better. People don’t travel as much as they used to out of town to go do things, McAllen has enough to do. And it’s also viewed as a destination city.” 

The McAllen-Edinburg-Mission metro area is still among the most affordable metros to live in nationwide, with the average single family home price of $247,000 in December, down from a recent peak of $279,000 in December 2023. 

Villalobos said the low cost of living is driving construction growth too. 

“Last year, residential construction was boosted by the unified development code, comprehensive rezoning and an updated building code that lowered our insurance costs,” he said. “We drove economic stability with consumer and investor confidence.” 

McAllen had a 29% increase in new subdivision development between 2024 and 2025. Last year, the city issued 1,300 residential construction permits valued at $241 million. 

More than 800 commercial permits were also issued by the city last year, representing $265 million in construction value. 

When both residential and commercial permits are combined, the city saw a 40% increase in construction between 2024 and 2025. 

The newest development on track for the city will be a new golf course, to be constructed just west of Champion Lakes Golf Course. The Lorena Ochoa Reyes signature golf course is designed by its namesake, the former Mexican professional golfer who played on the LPGA Tour between 2003 and 2010. It was not immediately clear how much that project would cost or when the course would open.