Invest In Apartment Buildings In Waco, TX

Where Waco's Renter Demand Comes From

Waco is a renter-majority city. The U.S. Census ACS 2020–2024 counts 27,258 renter households, 50.6% of the total, far above the Texas share of 37.4%. Population rose 5.7% in five years to 143,570, employed residents grew 12.0%, and renter households increased 3.4%. Median household income climbed 35.3% to $54,365, which is still modest, and 58.3% of renters spend 30% or more of income on housing.

Baylor University sits at the center of that demand. HUD's 2024 market analysis lists Baylor as the area's largest employer, with about 3,750 workers, and counts more than 20,800 students enrolled in fall 2023. Healthcare comes next, with Baylor Scott & White Health (about 2,700 jobs) and Ascension (about 2,375). The rest of HUD's top ten mixes public and private employers, including H-E-B, the City of Waco, the Department of Veterans Affairs, L3Harris Technologies, Walmart, McLennan County and Wayne-Sanderson Farms. Two large plants have since opened. Walmart held the grand opening of its milk processing facility in nearby Robinson on April 29, 2026, a plant of more than 300,000 square feet that cost more than $350 million and created more than 400 jobs, according to the company. Graphic Packaging International's recycled paperboard mill in Waco, which HUD's analysis tied to about 200 jobs, produced its first saleable rolls in October 2025, ahead of schedule, and has 500,000 tons of annual capacity, per Packaging Dive. Full production was expected 12 to 18 months after startup. Plant jobs like these tend to support workforce rentals in South Waco, Robinson and along the I-35 corridor more than the student blocks near Baylor.

The result is a broad renter pool of students, hospital staff, plant and distribution workers and government employees, all along Interstate 35 between Dallas–Fort Worth and Austin. Incomes cap how fast rents can rise, so owners in Waco tend to win on occupancy and expense control more than on pushing rent.

New Supply And Rents In Waco

Median gross rent in Waco is $1,165 a month (U.S. Census ACS 2020–2024), up 35.2% from $862 in the 2015–2019 survey and below the Texas median of $1,403. Census rental vacancy is 4.7%. That figure includes houses and small rentals, so it runs well below broker numbers for large complexes. Both Matthews (Q2 2026, citing CoStar) and GREA (mid-2025) put metro apartment vacancy at about 10.0%.

Waco added a lot of apartments. Homes in buildings with five or more units rose 17.1% in five years to 16,694, or 27.3% of the city's housing, even though the median home dates to 1979. HUD counted 1,250 rental units under construction in April 2024 and found that at least 56% of metro apartment completions since 2022 were in the city of Waco. That wave pushed average rent down about 1% in early 2024 while vacancy rose. The market has since absorbed more than it delivered: GREA reported 660 units absorbed against 545 delivered in the year to mid-2025, and Matthews reported 442 absorbed against 256 delivered in the year to Q2 2026.

Sources differ on rent level. GREA put the average market rent at $1,177 with flat growth in mid-2025, while Matthews reported a $1,375 average asking rent and roughly 2.3% to 2.7% annual growth in Q2 2026, with concessions at 1.7%. The pipeline is the watch item. Matthews counted 906 units under construction in Q2 2026, up 51.5% from the prior quarter, and reported occupancy of just 83% for buildings completed since 2020 against about 89% to 94% for older vintages. For apartment syndications in Waco, older stock that rents near the city median has been holding up better than new lease-ups, and buyers should expect new deliveries to compete on price for the next year or two.

Texas rules are friendly to owners on rent. There's no statewide rent cap, and state law lets a city adopt rent control only in narrow cases tied to a declared disaster or housing emergency, so Waco has none. Texas also sets no fixed notice period for rent increases on a lease; a month-to-month tenancy generally needs 30 days' written notice, and rent on a fixed-term lease can't change until it ends. In a soft market, that freedom matters less than the competition from new lease-ups.

Waco Submarkets We Watch

Brokers split Waco into a handful of submarkets that behave quite differently.

Waco By The Numbers

Among the 133 Texas cities we track, Waco ranks 104th for median gross rent, 14th for renter share and 53rd for five-year rent growth. Its rents fall in the middle of the pack. Compared with the 2015–2019 survey, Waco now has about 7,712 more residents, 896 more renter households and 2,438 more homes in buildings with 5 or more units. New homes in 5+ unit buildings outpaced the growth in renter households, so newer buildings are competing for tenants and older ones may need to offer more to keep them.

Waco Compared With Texas

Waco's median gross rent of $1,165 is below the Texas median of $1,403, and its renter share is 50.6% compared with 37.4% statewide.

Can Tenants Afford Waco Rents?

At $1,165 a month, the median Waco rent adds up to $13,980 a year, or roughly 25.7% of what the median household earns. Under the common 30% guideline, a household needs about $46,600 a year to cover that rent comfortably. That's a heavier load than the Texas average of 21.5%. Renters usually earn less than the all-household median, so the real burden for tenants is higher than this simple ratio shows.

In dollars, Waco rent climbed $303 a month over five years and household income climbed $14,184 a year. The two have moved together, so affordability today looks much like it did five years ago.

Waco Apartment Market Key Facts

Here's the Waco rental market in short form, with the source on every figure.

• Waco, TX has 143,570 residents, up 5.7% from the 2015–2019 survey (U.S. Census ACS 2020–2024).
• Median household income in Waco, TX is $54,365, up 35.3% over five years (U.S. Census ACS 2020–2024).
• Median gross rent in Waco, TX is $1,165 a month, up 35.2% over five years (U.S. Census ACS 2020–2024).
• 50.6% of households in Waco, TX rent, about 27,258 renter households (U.S. Census ACS 2020–2024).
• 27.3% of homes in Waco, TX are in buildings with 5 or more units (U.S. Census ACS 2020–2024).
• The rental vacancy rate in Waco, TX is 4.7%, and 58.3% of renters spend 30% or more of income on rent (U.S. Census ACS 2020–2024).
• The median home in Waco, TX was built in 1979 (U.S. Census ACS 2020–2024).

What We Look For In A Waco Apartment Building

Skyline buys 5+ unit apartment buildings in Waco that either run well today or can run better with new management or renovation. We start with rents, occupancy and the condition of the building, and we price on what the property earns now.

Texas has no state income tax on wages, and property taxes are often one of the largest expenses for apartment owners. We underwrite the tax bill after purchase, not the seller's current bill, since a sale often resets the assessment. Texas has no statewide rent control law, though local rules on notices, fees and deposits still apply. Insurance quotes in Texas reflect hurricane and flood exposure and hail and wind damage, so we get a quote before we make an offer.

After a stretch of fast rent growth, we keep rent assumptions modest and leave room for concessions if new supply opens nearby.

Evaluating Apartment Syndications In Waco

Whoever the sponsor is, these are the questions we would want answered about any apartment syndication in Waco, based on the local numbers above.

• What vacancy does the plan assume? Rental vacancy in Waco is 4.7%. A plan that assumes much lower vacancy than the market should explain why.
• What rent growth is underwritten? Rents here rose 35.2% over five years. Ask whether the plan assumes that pace continues, and what happens to the deal if rents stay flat.
• How was the property tax bill estimated? A sale often triggers a reassessment, so the bill after purchase can be well above what the seller pays today.
• What capital work is budgeted? The median home in Waco was built in 1979, so roofs, plumbing and electrical systems deserve their own line items.
• How will the building compete with new supply? Homes in 5+ unit buildings in Waco rose 17.1% over five years, so newer properties are part of the competition.
• How and when does capital come back? Ask what the plan is for a refinance or sale, and what happens if that takes longer than expected.

How Passive Investing In A Waco Apartment Syndication Works

In an apartment syndication, Skyline acts as the general partner. We find the Waco property, negotiate the purchase, arrange the loan and oversee management and any renovation. Limited partners put in capital and own a share of the entity that owns the building. They don't sign on the loan or deal with tenants and repairs.

It's a long-term commitment. The property has to be refinanced or sold before most capital comes back, and the outcome isn't certain. Eligibility rules vary by offering, and most are limited to accredited investors. See investing with Skyline Capital for how we work with limited partners.

Getting Started

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