Waco TX

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I'm an investor and live here in Waco.  Rental market is great.  Baylor is growing, and there's a general shortage of rental properties in the surrounding areas.  I'm looking for properties myself.

@Jeff Thompson I looked at buying a 24 unit apartment in Waco 6 months ago and there was nothing to support appreciation or rent rate growth. Unless you're right by Baylor and catering to the university in some regard, I don't think there's anything more compelling about Waco than a dozen other mid-sized Texas cities.

Killeen is Ft Hood, and at its mercy. I haven't lived there in years, but as far as I know it hasn't changed much. You don't want to rely on one large employer like that, especially one that is so closely tied to political whim...

While I wouldn't discount the "long major employer" issue entirely, I don't think it is wise to write of Killeen for that reason alone. It's the largest city between Austin and Dallas.  Fort Hood is the largest American military base IN THE WORLD by population, and the 2nd largest by size (White Sands is bigger). Look at a map of giant Texas, and you see a giant hole in the middle that is a giant playground for the US Army. It isn't going anywhere.

I would recommend evaluating Killeen on the deal and fundamentals like you would any other area. 

There are some headwinds to investing though. Sellers are expected to pay closing costs, not many owners with equity, high transition due to military PCSing, and other items.  But there are investors in our market who thrive.

Well, in Waco, Baylor is the largest employer.  The second largest is L-3 Communications - Platform Integration (an Aerospace Defense contractor), who employs around 2000 people, give or take.  They're going through a tough time right now.  and have had some layoffs.  Space-X out in McGregor is relatively new.  Anecdotally, I can say there is lots of construction and growth around town right now, and the mood is generally positive.  Obviously you'd want to do your due diligence.

Also, I will say that I know several folks who do a lot of business in the Temple/Killeen market, and do very well.  The high turnover with the Ft Hood creates plenty of opportunity.

I'm a real estate agent and investor in Killeen.  Although the federal government is the largest employer in Killeen, employment in health care and education is on the rise since we've had a lot of new economic development in those areas.  We've had incredible population growth too.  The population increased 43% over the past 10 years according to the last census.  I'm heavily invested in Killeen and Copperas Cove (7 income properties) and I'm not concerned at all.  I'm looking to expand my holdings much further.    

There is a lot of competition here and we have a complex rental market that is loaded with pitfalls.  It's best to find a mentor/agent that really knows how to navigate this rental market to minimize risks to your real estate portfolio.    

I am selling a rental property in Waco (Woodway to be specific) that I have not put on the market just yet.  It is currently occupied but tenant will be out at end of month.  Send me a message if any you are interested.

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Originally posted by @Brian Adams :

While I wouldn't discount the "long major employer" issue entirely, I don't think it is wise to write of Killeen for that reason alone. It's the largest city between Austin and Dallas.  Fort Hood is the largest American military base IN THE WORLD by population, and the 2nd largest by size (White Sands is bigger). Look at a map of giant Texas, and you see a giant hole in the middle that is a giant playground for the US Army. It isn't going anywhere.

I would recommend evaluating Killeen on the deal and fundamentals like you would any other area. 

There are some headwinds to investing though. Sellers are expected to pay closing costs, not many owners with equity, high transition due to military PCSing, and other items.  But there are investors in our market who thrive.

 My information is 20 years old... I do recall, though, several friends lamenting their investment properties being foreclosed on when many on the base deployed to Desert Storm. However, I guess I never heard those types of complaints during the past ten years of unpleasantries. 

You never know what a certain President or Congress will mean for Army strength. If you invest in Ft Hood I recommend you vote Republican. Lol

Even if the Army downsizes, that is not always bad for posts, especially ones like Fort Hood. For example, Hood is one of the major training locations for Army Reservists who come in for their Weekend Warrior exercises and two weeks in the summer. It is also cost effective for the Army to consolidate resources during draw downs, meaning Hood might actually get more resources during a troop draw down as other bases go poof and remaining units are consolidated on larger posts.

Early in the War on Terror - I was still in high school - apparently the Army deployed several units from Hood simultaneously.  I'm told it was a ghost town. Since then, the Army has become more aware of the impact of deployments on local populations and markets and staggers deployments among units within a post, part of what was called the ARFORGEN cycle when I was still in.

You can also look at it the other way.  Killeen's economy is recession-proof...meaning the military will always get paid.  If it really comes down to it, the government will print more money to pay the military if it has to.  During the 2008 financial crisis, we hardly felt it here.  In some parts of the country, the unemployment rate hit 20%.  In Killeen, we were at 4-6% largely because of the heavy government influence on the economy.  However unlikely, if every unit deployed from Fort Hood, we'd be in trouble.  It's a risk you take in this market.  In real estate, you always have some sort of risk.  If one is seeking a risk-free investment, I suggest a saving account earning near zero interest.  Even then, you'll have inflation risk.  The truth is there isn't a risk-free investment but I've thrived in this rental market so far.  I think its incredible and I look forward to assuming more risk...buying more property.  The way I look at it is I might as well go for it.  I only live once and I can't take anything with me.  I plan extensively and I've developed different courses of actions to deal with every situation.  I know no plan survives first contact but no plan at all...is planning to fail.  I feel like I'm ready for every scenario.  Keep an eye on me and we'll see how it turns out.  I believe in central Texas and Killeen.  It's the only spot on the map I'll invest in right now.

@Jeff Thompson

Locate and attend 3 different local REIA club meetings great place to meet people gather resources and info. Here you will meet wholesalers who provide deals and rehabbers (cash buyers). Find them through Google and meetup.com

Two Great reads, I bought both J. Scott The Book on Flipping Houses, The Book on Estimating ReHab Costs http://www.biggerpockets.com/flippingbook

To find out about an area go to IREM.org search for ARM certified property managers. Call 5 ask them what they see expenses running per category per unit. What do they see them selling for per unit, what is the market occupancy rate. What are the market rents? Ask them if they know anything coming up for sale. Great way to pick up some good info and possibly a deal.

You can also search NARPM.org for the RMP (Residential Management Professional) and MPM (Master Property Manager) certified.

Paul

@Steve Parker   Hi Steve- trying to help a client find a primary residence that would make a decent rental in a few years in Waco.  Can you recommend a Waco agent that understands the investment side?  Thanks!