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lubbock texas rental market recession proof pandemic covid

Texas has been known for having what it takes to be recession-resistant, and this especially applies to the city of Lubbock. With that in mind, over the past few years, the Lone Star State’s strong economic reputation was put to the test as the Covid pandemic swept through the nation, as well as around the world.

Many individuals who owned rental properties within Texas were unsure if their investments could withstand the hardships of Covid. Fortunately, today, when the nation is mostly out of the woods and in a better place when it comes to the pandemic, the Texas rental market, and Lubbock in general, are still standing strong. In this article, we’re going to take a close look at the recession-proof qualities of Lubbock, TX, with an emphasis on its lucrative rental market.

Lubbock, TX Among Most Recession-Proof Cities in the Nation – Why is this the Case?

There are many traits that a city must have to be considered recession-resistant, and Lubbock passes with flying colors on all major points. This is why when the personal finance company, SmartAsset, conducted a study of the most recession-proof cities in 2020, using information from the U.S. Census Bureau and other reliable resources, as well as evaluating each city’s past performance during the Great Recession of 2007-2009, Lubbock proudly made the list of the ten most recession-resistant cities.

The city of Lubbock is currently recognized as economically strong because of its steadily growing population, strong job market, thriving economy, as well as its ability to withstand the recent pandemic that devastated many other cities across the nation. With all that said, let’s discuss this in more detail:

1. Lubbock Proved Itself During One of the Most Difficult Economic Times in Recent History – The Covid Pandemic

As mentioned, even before Covid hit, Lubbock was considered to be recession-proof, and now that this city has gone through a pandemic that prompted an extreme economic downturn across the nation, and it didn’t falter, it has most certainly earned its title. Lubbock’s mayor, Dan Pope, brings this to light when he stated that the Lubbock unemployment rate really didn’t change much from pre-pandemic levels to current day, and that there are more jobs in Lubbock than there were two years ago. These statements speak volumes about this city’s economy in general, and its capability to keep marching forward even during economic turmoil.

Being economically strong, Lubbock was already in a good place to withstand the economic challenges that every city in the nation was facing. Even so, this city made some smart moves to ensure it was on par with fighting off some of the unavoidable pandemic issues. This included issues such as mandatory business shutdowns at the height of the spread of Covid. To help offset this, the city kept its local businesses afloat with programs like the City of Lubbock Public Health Emergency Microgrant Program and other financial assistance programs.

Along with local businesses not folding when put to the test, The Texas rental market, specifically within Lubbock, continued to thrive during the economic uncertainty that the pandemic created. Our team has first-hand knowledge of this because we were in the midst of it, building new construction rental properties within Lubbock and providing them to investors through the course of the pandemic. Justin F., Chief Executive Officer of SDIRA Wealth, sums it up perfectly:

“Our company and solutions were created for times like this so our clients can protect their wealth and maximize all the benefits we provide.”

Currently, the Lubbock rental market is in great shape; recent rental market trends in this Texas city show that renter-occupied units make up almost 50% of the housing market, and the rental vacancy rate in Lubbock is low, which indicates a high demand for rentals. In addition to this, rent prices have increased compared to this time last year. As you can see, from an investor’s point of view, these stats are not bad for just rolling out of a pandemic, and make for a strong rental market in this West Texas city. Related to this, you may find it interesting to read about a personal investment experience of one of our clients – Recession Proof Your Investing – An Interview with Jarrett.

The following video touches on Lubbock being on the top ten list of recession-resistant cities; it’s worth watching if this topic has sparked your interest:


2. A Prosperous Economy & Thriving Job Market Make it a Texas Hot Spot for Real Estate Investors

Lubbock’s prosperous economy, brought about by its thriving job market, are two indicators that it’s an area that can withstand a recession, and the fact that it stood up to the pandemic as it did, is proof of just how durable its economy really is. A combination such as this places Lubbock high on the list when it comes to cities in Texas that are prime rental real estate investment opportunities.

What specifically makes Lubbock’s economy so successful that it kept its recession-proof status even during a nationwide economic collapse? First off, Lubbock maintains a low unemployment rate which enables this city to keep thriving. This is due to the fact that there’s a massive amount of good stable jobs in the area – let’s take a moment to break this down a bit:

Large University in Lubbock Employs Thousands

One source of employment is Texas Tech University, which is located in the heart of Lubbock. This is a large college that employs thousands of faculty, staff, and others. Also worth noting is the fact that Texas Tech has pumped over one billion dollars into Lubbock, fueling the city even further. In addition to this, there are over 40,000 students enrolled in an academic year, which means there will certainly be a high demand for rental properties in the area.

Successful Businesses in this West Texas City Provide Stable Jobs

Lubbock is the home of many successful businesses, as well as Fortune 500 companies that provide stable work for the city’s residents. These are companies such as Amazon, IBM, Cisco, and many others. Having companies such as these that have a solid foundation, means workers can find employment and stay employed. Think about it, during the pandemic, Amazon excelled due to the fact that everyone turned to ordering online to reduce their exposure to Covid, which caused Amazon to hire even more people within the Lubbock area. When this company moved to Lubbock, it estimated it would hire 230 full-time and several hundred part-time jobs. Jobs such as these provide money that pays the rent, which keeps your investment property stable and profitable.

The Lubbock Healthcare Sector Keeps the Economy Going

Two major healthcare employers are situated within Lubbock – UMC and Covenant Health. As you know, hospitals and the healthcare system, in general, didn’t crumble during the pandemic. It was quite the opposite; they went into double-time, which means their employees had job security.

The UMC healthcare system employs more than 4,500 people and disperses over $280 million in payroll, which are impressive numbers. Along with this, Covenant Health is also located within this West Texas city and is considered one of the largest healthcare systems and employs thousands within the area. With that said, this sector propels the Lubbock economy and helps maintain its recession-proof status, as well as brings thousands of individuals and families to Lubbock who need jobs and a place to call home.

The details above clearly explain why Lubbock has the ability to be recession-proof no matter what the economy dishes out, and this creates the perfect setup for someone to obtain a secure and lucrative investment property in this city. Clayton Morris, Founder and President of Morris Invest, agrees with this point when he states:

“Lubbock’s economy is booming, and because of its college presence and healthcare system, it makes for an incredible rental market. We also do extensive market research, and I feel really confident in the profitability and the sustainability of the Lubbock rental market.”

If you’d like to hear more about the above points in detail, feel free to dive into the following video:


What Else Makes Lubbock a Good Location Within Texas to Invest in Rental Real Estate?

Now that you realize just how recession-proof the city of Lubbock is, making it the ideal location within Texas to own a rental property, let’s jump into a few other reasons why investing in this area makes perfect sense.

1. Situated Between Five Main Freeways Makes it Easy to Live in Lubbock and Work Elsewhere

Lubbock is known to be a hub city for a few reasons, and one of them is that it’s a true transportation hub. What do I mean by this? Well, Lubbock is strategically located in an area where five major freeways connect to it. This makes it a central location for people to live and have the ability to easily hop on a freeway to commute to another city for work.

In contrast, there are many areas within the state of Texas where it can be a 1/2-hour drive to a major freeway, which makes for a less than desirable location for commuters. So, with Lubbock having several main freeways passing through it, more individuals are able to set up camp in this city. This is one scenario that draws in renters to this attractive area, and therefore makes it a wise location for real estate investors to buy property.

2. The Texas Population is Rapidly Growing and it’s Creating a High Demand for Rentals

Texas is ranked as having the 2nd highest population in the U.S., with an estimated population of 29.9 million in 2022. On top of this, with more people leaving the state of CA to escape the high cost of living and skyrocketing housing costs, the Texas population will just keep growing. Lubbock is an appealing area for residents for multiple reasons, and because of this, the population within this city is steadily increasing.

A steady increase in population equates to rental market security that investors can bank on, especially those who are interested in new construction properties. You see, population growth means there will also be a high demand for rentals, and this can lead to a supply and demand issue where new construction properties come to the rescue. There’s plenty of space to build in Lubbock, making room for current and future renters, and at the same time, enabling investors to grow their portfolios with lucrative rental properties.

You may be interested in reading the following article we put together that touches on the increased demand for rental properties – Rental Real Estate Trends – Increased Demand & New Construction Property Boom.

3. Investment Properties are More Affordable in Texas Which Yields a Higher ROI

Although housing prices seem to be going up all over the nation, Texas has generally sported a more affordable housing market. This is the case because, overall, the cost of living is lower in the Lone Star State, making building costs such as materials and labor more affordable, which brings the total cost of real estate down. Also, it’s obvious that there’s a lot of land in Texas, which makes the cost of land cheaper because there’s less competition, and this brings the cost down as well.

To make this point, imagine trying to buy land to build a rental in California. The housing prices are sky high there, and the lack of available land, as well as the high cost of living, are the main culprits. The bottom line is that a higher-priced rental property purchase equates to a lower ROI. This is why Lubbock, with its affordable housing costs, yields a high ROI, which is the goal.

Take a moment to view this video that goes into detail on why Texas investment properties are cheaper:


4. Investors Increase Their Profits in West Texas Because There’s No State Income Tax

With your bottom line in mind, investing in an area where you won’t have to pay state income tax on your rental income is a huge plus, and why many individuals choose to buy rental real estate in Lubbock. Keep in mind that Federal income tax will still be due, so you’ll want to ensure you’re on top of your game when it comes to lowering your tax burden. With that said, I suggest diving into a book that can help you save thousands of dollars in taxes, you can find it on Amazon, and it’s called Tax-Free Wealth. I’ve read this book multiple times, and I’ve found it really helpful.

If you’re looking to maximize your profits by lowering the amount of money you own in taxes, you can visit our Lower Taxes information page that details working with WealthAbility, a company that’s run by the author of Tax-Free Wealth, Tom Wheelwright, who is the personal accountant of real estate giant Robert Kiyosaki. This company focuses on tax strategies that can keep more money in your pocket.

I also suggest heading over to this article we put together on a strategy that pertains to significantly lowering your tax burden – The Power of a New Construction Cost Segregation Study Can Save You Thousands.

5. The Law is On Your Side When You Own a Rental Property in Lubbock

If you’ve been investing for a while now, I’m sure you’ve heard a few tenant-landlord nightmare stories. Most of these situations happen when you own a rental property in a state that favors the tenant’s rights. For instance, maybe a tenant decides not to pay, and they just continue to live in your property rent-free.

When you don’t have the support of the state, it can become a long, drawn-out, costly situation to evict the tenant. It doesn’t have to be this way, though. When you invest in a state that’s landlord-friendly, like Texas, and a tenant is in breach of contract, the law favors the landlord, and this can literally save you thousands of dollars in court fees and lost rent, as well as your time. Also, keep in mind that a professional property manager is experienced in vetting qualified tenants to avoid this type of situation in the first place. But even so, when you invest in a landlord-friendly state, you can rest assured that your rights as a landlord are a top priority.

Real Stories from Those Who Have Invested in Lubbock

It always helps to hear real stories from real investors who may have the same financial and investment goals that you have. With that said, I’d like to share two interviews we had with investors who took action and now own cash flowing rental properties in West Texas.

Secure Your Wealth & Your Future by Investing in a Recession-Proof City in 2024

With the uncertainty of today’s economy, inflation on the rise, as well as the fact that we have no way to predict if another pandemic will hit the nation hard again, you should ensure that if you’re going to invest your hard-earned money, that you do it within a city such as Lubbock that’s proven itself as recession-resistant, profitable, and stable.

Morris Invest specializes in building new construction rental properties within the city of Lubbock, and because we’re a full-service investment company, we do all the work for you. This includes providing you with a lucrative property, placing an experienced property manager, as well as filling your rental with a reliable tenant. We make it super simple for you to achieve your dream of owning a cash flowing rental property with the goal of securing your financial future. You can contact Morris Invest if you have any questions about the city of Lubbock, the process of buying a rental property, or how to get the ball rolling.

In the meantime, you can check out a few of the real estate programs we offer to investors, or grab a cup of coffee and take a personal tour of one of our new construction properties in Lubbock by watching the following video:


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