Hi everyone,
First time posting on the BP forums. Already received tremendous insight from this thread, but wanted to reach out to see if anyone had any updates on the Killeen / Fort Hood investment market. I'm an investor looking to buy and hold and possibly make my first investment in this market.
It looks like fourplexes currently on the market in NW Killeen (76549 zip code) right now are asking a avg/median price of $225,000 with an estimated monthly rental income of $2,300 (assuming two units are 3/2 and two are 2/1.5, with estimated rents of $600 and $500 respectively) -- i.e. they precisely meet the 1% rule.
Also based on my estimates, it looks like the cap rates for these fourplexes is generally around 7%.
Assuming a 90% vacancy rate, 10% for property management and 1.5% of PP per year for repairs/capex (~$3,200), I'm projecting an 11-17% IRR on a 25% down conventional financing at these asking prices, which is attractive for me.
Can anyone give me some feedback on my assumptions (e.g. projected rents, vacancy rates, repairs/capex budget) and pour cold water on my projections? Does anyone know what the replacement cost (i.e. cost to build) in the market is these days? And whether you recommend starting with a duplex vs. a fourplex?
Thanks!
