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Killeen Real Estate Investment

A cursory look at the real estate market along the I-35 corridor reveals one thing, Killeen is the place to invest in, more so for long-term investors. It’s the perfect investment area for anyone who wants to set down roots or invest in property that will bring them passive income.

My name is Steffen, a realtor, and I am here to tell you why Killen is a good investment place for both short-term rentals and long-term buy-hold assets.

Arial view of a neighborhood in Killeen, Texas
Killeen
is the place to invest in

Real Estate Investing Performance In Killeen

Avg Purchase Price Avg Cap Rate Avg Cash on Cash Return Avg Cash Needed to close
Commercial 5+ units LTR 125k - 200k per door 4% - 7% 0%-5% (assumes 25% down payment) $45,000 per door
Short Term Rental (SFH) 350k - 550k 7% - 9% 8% - 12% $92,500 (furnished)
STR (2-4 Units) 175k - 225k per door 8% - 10% 9% - 13% $51,500 per door (furnished)
Long Term Rental (2-4 Units) 150k - 200k per door 3% - 5% 0% - 5% $48,000 per door
Long Term Rental (SFH) 275k - 350k 0% - 4% 0% - 4% $71,500
Househack (2-4 Units) 150k - 200k per door n/a n/a $12,250 per door
Househack (SFH) 300k - 400k n/a n/a $17,500

Previously Sold Properties

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Tips for Investing in Killeen

Fort Hood, in Killeen, is one of the largest active duty posts in the United States, helps protect the local economy. Here, you’re guaranteed to find lots of small, mid-sized, and large multi-family properties, all located in neighborhoods with low crime rates and high rental rates

If you’re an out-of-state investor, we recommend partnering with a renowned property management firm to get the most out of this market. The same holds for in-state investors who don’t know how to go about managing a real estate portfolio!

Some of the top reasons why this is the best option for you include the following:

  • Active military personnel can have their orders changed within a moment’s notice, leading to a high tenant turnover. 
  • Neighborhood safety can become an issue, especially in areas that have begun to experience double-digit cap rates.
  • You’ll need to familiarize yourself with various subsidy programs to avoid losing out on potential investment opportunities.

And this is not forgetting the issue of the small apartment units, which are quite many in this area. As such, the best thing you can do for yourself and your investment is to concentrate on the larger units while avoiding the 400 square foot 1 bed one bath units.

Where possible, try to invest in those that are larger than 650 square feet when looking at the one-bedroom units and above 900 square feet for the two-bedroom ones. In Killeen, big is always best, as this assists in significantly reducing tenant turnover

Lastly, we would also like to mention that there are some very beautiful multis in this area which tend to come into the market more frequently. Alternatively, you can also look at the dilapidated complexes suffering from years of neglect and give them a makeover

If you go with the latter option, make sure to hold out for something that’s in excellent condition. Don’t be surprised to come across tons of properties that have undergone “lipstick renovations” to make them more appealing to tenants. 

 

Main Activities/ Attractions in Killeen 

As we mentioned in the introduction, Fort Hood, located in Killeen, Texas, is the largest active-duty armored military base in the U.S. and the world. The base can easily accommodate two full armored divisions and have enough room for support personnel

Furthermore, Killeen is equidistant from both Waco, TX, and Austin, TX. If you want to experience everything it offers, head south from Killeen and into Austin to enable you to experience its nightlife, F1 races, tech scene, and fine dining experience.

Success stories investing in this area

“Used Victor in finding and purchasing my first investment property. Victor and his team were knowledgeable in providing help along the way especially toward the end while getting everything squared away.”

Investor

Logan Hicks

Strategy

Long Term Rental

Victor was an awesome realtor! We were first time investors in Texas and he was very responsive, experienced, and pleasant. Every question we had he answered promptly and from start to finish Victor guided us thorough the whole process and made the buying transaction as smooth as possible for us! You will not be disappointed by working with Victor Steffen, thank you Victor!

Investor

Janeth Quintero

Strategy

Long Term Rental

Killeen Investment Strategies 

Image showing concrete buildings under a blue skyline

When it comes to investment strategies, the best tip we can give you is to focus on investing in mid-sized multi-family properties and in getting long-term tenants. After all, Killeen is a long-term, traditional real estate investor’s market. It’s what makes it so appealing. 

Focus on catering to what the local market has to offer, ensuring that you provide a comfortable housing solution for the active duty service members. Many of these members are stationed at the base for a period of two to three years at a time

Based on our experience, apartments that are well-serviced and spacious enough to accommodate the needs of military families tend to perform much better. There are investors who find it better to target the mid-term tenant base

However, we have also seen others do well by targeting traditional tenants. Whichever route you choose to follow, make sure to apply a strategy that will not require you to apply too much effort or spend too much of your free time managing the rentals.

In some cases, you could even charge a premium rental rate by providing your tenants with fully furnished Killeen apartments. If you decide to go with this option, we suggest you put yourself in the shoes of a soldier who has just moved into the Killeen area

Ask yourself this, what would such a person find attractive in a home where they intend to live for the next two to three years? The answer you’ll get after asking yourself this will help you make an informed investment decision

Is Killeen a Good Real Estate Investment?

Killeen, Texas, is considered a strong market for real estate investors to consider building a long-term buy-and-hold portfolio of rental properties for several reasons, including:

Growing Population: Killeen has experienced significant population growth in recent years, driven in part by its proximity to Fort Hood, one of the largest military installations in the United States. This growing population has created a strong demand for housing, and has helped to support the local real estate market. According to the U.S. Census Bureau, the population of Killeen was around 40,000 in the early 1980s and has since grown to over 140,000 in recent years.

Affordability: Killeen is known for its relatively affordable housing options compared to other major cities in the United States, making it an attractive option for first-time homebuyers, families, and real estate investors. The median home value in Killeen is around $180,000, which is lower than the state average. The city has a good mix of affordable single-family homes, townhouses, and apartments, making it an attractive option for first-time home buyers and renters. Additionally, Killeen has a strong rental market, with a high demand for rental properties and low rental vacancy rates, which is good for real estate investors.

Strong Rental Demand: With a growing population and a strong military presence, there is a steady demand for rental properties in Killeen. This demand for rental properties can help to ensure a consistent and stable rental income for real estate investors.

Proximity to Major Cities: Killeen is located in central Texas and is within a few hours’ drive of major cities like Austin and San Antonio. This proximity to these major cities, combined with its strong local economy and relatively affordable housing options, makes Killeen an attractive place to live, work, and invest.

 

Is it a Good Time to Invest in Killeen?

Right now is a wonderful time to jump into the Killeen TX real estate market!
There have been several real estate developments in Killeen, Texas over the last decade that have helped to shape the city into a growing, thriving community. Some of the most notable developments include:

The Killeen Mall: This large shopping mall was recently renovated and expanded, and now features a variety of retail stores, restaurants, and entertainment options. The Killeen Mall has become a popular destination for residents and visitors alike.

The Market Heights Shopping Center: This new shopping center features a variety of big-box retailers and smaller specialty stores, as well as a grocery store, a movie theater, and a number of restaurants. The Market Heights Shopping Center has become a popular destination for residents and has helped to drive economic growth in the area.

The Fort Hood Military Base: Killeen is home to the Fort Hood Military Base, one of the largest military installations in the country. The base has undergone a number of renovations and expansions over the last decade, and now features a variety of housing options, recreational facilities, and support services for military personnel and their families.

The Killeen Civic and Conference Center: This large conference center features a variety of meeting spaces, a ballroom, and a performing arts theater. The Killeen Civic and Conference Center is a popular venue for events and has helped to drive economic growth in the area.

Best Neighbourhoods to Invest in Killeen

Some of the different communities in Killeen, Texas that our investors have found success include:

Harker Heights

Harker Heights is a city located just outside of Killeen, offering a range of homes, parks, and a convenient location near Fort Hood military base.

Nolanville

Nolanville is a city located just outside of Killeen, offering a range of homes, parks, and a convenient location near Fort Hood military base.

Trimmier Estates

Trimmier Estates is a neighborhood located in Killeen, offering a range of affordable homes and a convenient location near amenities and attractions.

Clear Creek

Clear Creek is a neighborhood located in Killeen, offering a range of homes and a convenient location near Fort Hood military base.

Timber Ridge

Timber Ridge is a neighborhood located in Killeen, offering a range of homes and a convenient location near Fort Hood military base.

 

Financing Information for Killeen Real Estate Investors

Investing in real estate calls for you to have a good amount of cash at hand or, at best, have a good financing option ready. It explains why so many people tend to shy away from investing in commercial properties that can help them earn a decent income. 

The City of Killeen understands this, which is why it has made it possible for low to moderate-income earners to get funding and buy a home or investment property. To this end, please make sure to do your research to learn what’s expected of you before getting started. 

You can check homebuyer education courses that are readily available online to learn more

 

Positive Cashflow in Appreciating Markets

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Frequently asked questions

Is Killeen a Good Real Estate Investment?
Killeen, Texas, is considered a strong market for real estate investors to consider building a long-term buy-and-hold portfolio of rental properties for several reasons, including: Growing Population: Killeen has experienced significant population growth in recent years, driven in part by its proximity to Fort Hood, one of the largest military installations in the United States. This growing population has created a strong demand for housing, and has helped to support the local real estate market. According to the U.S. Census Bureau, the population of Killeen was around 40,000 in the early 1980s and has since grown to over 140,000 in recent years. Affordability: Killeen is known for its relatively affordable housing options compared to other major cities in the United States, making it an attractive option for first-time homebuyers, families, and real estate investors. The median home value in Killeen is around $180,000, which is lower than the state average. The city has a good mix of affordable single-family homes, townhouses, and apartments, making it an attractive option for first-time home buyers and renters. Additionally, Killeen has a strong rental market, with a high demand for rental properties and low rental vacancy rates, which is good for real estate investors. Strong Rental Demand: With a growing population and a strong military presence, there is a steady demand for rental properties in Killeen. This demand for rental properties can help to ensure a consistent and stable rental income for real estate investors. Proximity to Major Cities: Killeen is located in central Texas and is within a few hours' drive of major cities like Austin and San Antonio. This proximity to these major cities, combined with its strong local economy and relatively affordable housing options, makes Killeen an attractive place to live, work, and invest.
Is it a Good Time to Invest in Killeen?
Right now is a wonderful time to jump into the Killeen TX real estate market! There have been several real estate developments in Killeen, Texas over the last decade that have helped to shape the city into a growing, thriving community. Some of the most notable developments include: The Killeen Mall: This large shopping mall was recently renovated and expanded, and now features a variety of retail stores, restaurants, and entertainment options. The Killeen Mall has become a popular destination for residents and visitors alike. The Market Heights Shopping Center: This new shopping center features a variety of big-box retailers and smaller specialty stores, as well as a grocery store, a movie theater, and a number of restaurants. The Market Heights Shopping Center has become a popular destination for residents and has helped to drive economic growth in the area. The Fort Hood Military Base: Killeen is home to the Fort Hood Military Base, one of the largest military installations in the country. The base has undergone a number of renovations and expansions over the last decade, and now features a variety of housing options, recreational facilities, and support services for military personnel and their families. The Killeen Civic and Conference Center: This large conference center features a variety of meeting spaces, a ballroom, and a performing arts theater. The Killeen Civic and Conference Center is a popular venue for events and has helped to drive economic growth in the area.
Positive Cashflow in Appreciating Markets

Ready to invest in central Killeen real estate?

Schedule a call