Waco rental portfolio loans for owners of several doors.
Built for investors who own multiple properties. Roll five or more rentals into one blanket loan with a single payment, free up capital to keep scaling, and release individual properties as you sell. Baylor-area rental houses get bought a few at a time and often end up on separate mortgages. Business-purpose only, and every structure is set in underwriting.
Typical figures, subject to underwriting and market conditions. Not a commitment to lend.
How it works
Instead of a separate mortgage on every door, we structure one blanket loan secured by the portfolio, with the option to release individual properties as you sell them. It is built for investors scaling past a handful of rentals.
Why does a Waco portfolio usually mean student rentals near Baylor, not short-term rentals?
Because the zoning only works one of those two ways. Waco does not allow the classic non-owner-occupied Airbnb (STR Type II) in its R-E, R-1A, R-1B, or R-1C districts, and the city removed the special-permit path for it effective 2021-06-15. An STR license also does not transfer with the property at sale, so a buyer has to qualify a house fresh rather than inherit the seller's license. Long-term and by-the-bedroom student leasing has no such gate: Waco's zoning definition of "family" carries no cap on unrelated occupants, so a scattered book of rental houses near campus is the portfolio that actually assembles here. If a deal in your book is pitched as an STR play, check the zoning district before you count on that income.
How many students are actually renting near Baylor right now, and is that base growing?
It shrank last year, so don't underwrite a growth assumption. Baylor's Fall 2025 headcount was 19,858 (14,183 undergraduate, 5,675 graduate and professional), down from 20,626 in Fall 2024, a drop of 768 students or 3.7% in one year. That's still a large, durable tenant base for a portfolio of rental houses, and it sits alongside roughly 5,700 Baylor employees, two hospital systems, and a VA medical center in the same metro. We just don't want a Waco portfolio pro forma built on an enrollment curve that's actually pointed down.
Do all the doors in a Waco portfolio carry the same property tax rate?
No, and the spread is bigger than in most Texas metros. A door in the city of Waco with Waco ISD runs about 2.2484 per $100 of assessed value with no homestead exemption available to an investor (county 0.334805 + McLennan Community College 0.131974 + City of Waco 0.755000 + Waco ISD 1.026600). China Spring, unincorporated with no city rate, runs 1.4487 on the metro's second-highest home values ($445,336, June 2026). The city of Waco with Waco ISD is the heaviest stack on the county's 2025 table among the submarkets we track. Because city limits and school district lines are not the same boundary here, the ISD on any given door has to be read off the parcel's account rather than assumed from its mailing address. We underwrite each door on its own McLennan CAD-assessed value, so a mixed-city Waco portfolio needs every parcel's stack run separately, not a blended average.
What does a heavy rehab do to a portfolio door that sits inside Waco's College and University Neighborhoods overlay?
It can pull that one door into a whole extra set of requirements mid-portfolio. The overlay around Baylor only kicks in on new development or a "substantial renovation," defined by a ratio of renovation cost to appraised building value: 30% above $200,000, 40% between $100,000 and $200,000, 50% below $100,000. Roof, HVAC, electrical, plumbing, foundation, and rotten-wood repair are excluded from that ratio. Cross the line and the property must meet one parking space per bedroom, a ten-foot pedestrian way, landscape screening, and architectural review. A $48,000 gut on a $120,000 house near campus is a routine number for a rent-by-the-bedroom conversion, so check each portfolio door's renovation scope against its appraised value before you assume it's a simple cosmetic update. This is a zoning question for the property, not something we can waive; if a program with faster acquisition timing fits your next purchase, see our fix and flip loan.
How much of a Waco portfolio's yield actually survives insurance and tax carry?
Meaningfully less than the headline gross yield, and hail is the reason. The city of Waco pencils an 8.2% gross rent-to-value yield ($1,369 monthly ZORI rent on a $200,115 mid-tier Zillow value, June 2026), the best in the tracked submarkets against 6.2% in Hewitt and 5.7% in Woodway. But that's before carry: McLennan County paid $1,216 per policy in homeowners losses in 2025, with wind and hail at 53% of that, and a 2023-shaped year ran $2,575 per policy with wind at $1,986. Underwrite roof age and deductibles to the bad year, not the quiet one, and add the 2.2484 tax stack in the city on top before you call a number a net yield across the book.
How does the per-door cost of a Waco portfolio compare to a bigger Texas metro like Austin?
A Waco portfolio buys far more doors for the same capital. At the city's roughly $200,000 mid-tier value, and about $157,000 in Bellmead, a ten-door Waco portfolio runs close to what four doors would cost in the Austin metro, where the comparable mid-tier value sits near $434,000. That lower entry basis is the tradeoff for this market's flat, low-cost yield profile: more doors per dollar of capital, on a market gaining value slowly rather than fast.
At roughly $200,000 a door in the city of Waco, how many doors clear the portfolio floor?
Five, which is about $1,000,000 of property here. At the city of Waco's roughly $200,000 mid-tier value, five doors is about $1,000,000 of property (5 x 200,000 = 1,000,000), so an ordinary scattered book of Baylor-area rental houses clears the floor without anything exotic. What you get for it is one blanket loan and a single consolidated payment on a custom term. Below five doors, individual DSCR loans are usually the better structure. Subject to underwriting.
Baylor's headcount fell 3.7% last year. Can I shed one door without refinancing the book?
Yes. Individual properties release from the blanket loan as you sell them. The rest of the book stays on one loan with a single consolidated payment and its custom term. That matters in Waco specifically: Baylor's headcount fell 3.7% between Fall 2024 and Fall 2025, so a portfolio built around campus demand should be able to shed a door without unwinding everything around it. Subject to underwriting.
Local rules move. Every tax rate, fee, ordinance and market figure here comes from a primary source and carries the date we read it, and we correct them as the rules change. Where a number is mid-change or we could not verify it, we say so rather than guess. Before you commit a budget, confirm anything that drives it with the city or county, and talk to your attorney or CPA on questions of law or tax.
Published by USA Mortgage Funding, LLC, NMLS #152588. Researched from primary sources by our team, drafted with AI assistance, and every figure checked against its source before publishing. Where an answer rests on a public record, that record is linked under it. Figures read on 2026-08-13.
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