All Forum Posts by: Brian Adams

76541 is downtown Killeen - the older area. Your median year built is in the 1960s vs. 2005 for the area as a whole, so much, much older. Killeen can only grow south - away from downtown, meaning that the downtown area is not central to the city like it is in other Texas cities. 

Median prices in the area are very low, and there likely won't be enough margin for a flip. There are some landlords who specialize in low-income single families and multi-families who might be interested in buy and hold in areas like these, but frankly it is a difficult area to get good deals. The few investors I know who have done some deals there essentially managed to get the house for the value of the land ($10,000 or less in most cases) and wholesale to a buy-and-hold type.

I am with StarPointe Realty as a Realtor. They also have property management that I think is good and manages both my rental properties in the area (one fourplex, one SFH).

I've had favorable impressions of the property management teams at Gold Medal and Blessed Properties in the area for two others to interview.

Yes - just to clarify - both Temple and Killeen are great areas for rentals. Just have to be wary of certain areas and the deals that on paper are best often are in the areas or rent ranges that you are best avoiding unless you are local and want to do property management yourself or with an inhouse PM.

I'm a Killeen agent. All else being equal, the comments above are correct. Temple is probably the better play because of I-35 and other growth.

13% cap rate is crazy high, though. Is it an off-market property? Are you looking at single family rentals?

Some paper math works out to those kinds of numbers on the cheapest stuff, but then you need to be REALLY wary, definitely of Killeen and probably Temple, too. Those paper returns don't always materialize and the property can be a massive headache. Make sure that a property manager is willing to manage it before you buy (even if managing it yourself - a property manager's endorsement will validate that you are in a decent area).

Higher crime rates seem to be a feature of many towns that are dominated by the military (ex. Fayetteville, NC, a city very similar to Killeen, has a similar reputation). 

There are definitely parts of Killeen you want to avoid in my opinion and target a certain minimum rent/unit depending on the property type. But it's not the case that Killeen is a giant gangland or anything. I personally live in Killeen and have never had issues. Killeen has seen a LOT of growth, and the newer housing and neighborhoods are just fine, in my opinion.

Combine that with the fact that the rental market is strong and you can still actually cash flow unlike just about anywhere else in the Texas Triangle, and it's definitely worthy of your consideration in my opinion. I've worked with quite a few Californians and New Yorkers buying $80k SFH rentals, $150k duplexes, $200k fourplexes, and $7M 160 unit apartments in our area. All of these folks are multiple buyers, suggesting they've had success and been happy with the properties they've been collecting so far.

So, bottom line, Killeen can absolutely rock it. Just know what minimum criteria you need to target. I talk more about what I look for on my own blog in the investor articles.

Yes, you definitely don't want to target the bottom of the barrell in rents. I'd stick to units that rent at least $500+, and SFH at $750+. But our market has plenty of those versus other markets, including decent foreclosures to pick from still - though often going multiple offers.

Ah, to be Killeen in 2016 again, @Nirmal Khanderia , when the foreclosures sat on the market, fourplexes were a dime a dozen, and nothing went multiple offers. Hot markets are both a blessing and a curse. It's almost impossible to find stuff now, it feels like (though still a lot better than the Austin market).

Hello Chance!

There actually are quite a few multi-families in the area. I know of one agent who is expecting quite a few multi-families to be coming on the market in the Temple area shortly. I don't know if they are buildings that would meet my criteria, but could be interesting options given the market.

I say there are quite a few - there are quite a few versus any other market in Central Texas like Austin or Williamson County where most stuff isn't selling or sells off market. If you are patient and the numbers work, you can likely find a decent fourplex in the Killeen, Harker Heights, Copperas Cove area. Alternatively, duplexes are even more plentiful. They don't have the same numbers on paper as fourplexes, but property managers insist that the turnover is significantly less. I don't know of any hard numbers on that observation, but anecdotally that has been my own observation while in this market.

I have a fourplex and a single family rental, yes. Worked with quite a few investors as well in all categories of investment. It's definitely a different market that you want to study up on, but plenty of opportunities. Folks seem to be finding out because there are more and more investors clamoring and scooping the multi-families and foreclosures that do come up.

I'm an agent in the Killeen market, and yes, there is a fair amount of mid-size town type investment going on in the area. A lot of buy and holders, BRRRRers, a few flippers, multi-families including duplexes and fourplexes, and foreclosures. The market historically has been flat, but just last year the median price in the area rose by 11% for single families, and the market now is moving more quickly than anything us agents have seen since most of us started our business.