Oklahoma City is a study in contrasts, from oil rigs to Art Deco architecture, placid suburban neighborhoods to a bustling downtown. "OKC" is seeing an inpouring of investment dollars which, in turn, is creating jobs. Sure, the state's robust oil and natural gas industry is responsible for 20 percent of the city's jobs, but information and finance, transportation and distribution, agriculture and the nascent biosciences sector all contribute to the city's evolving economic landscape. Oklahoma City has even given economic incentives to two corporate giants, Paycom and Boeing, to expand there and create thousands of jobs in the process.
The more than 580,000 residents of Oklahoma City live in neighborhoods bisected by the North Canadian River (referred to as the Oklahoma River while in the city limits). In the north you'll find both urban and suburban neighborhoods while southern neighborhoods tend to be more industrial in nature with blue-collar populations.
The revitalization of the city's downtown area, home to more than 7,500 residents, came about as a result of United Airlines choosing Indianapolis over Oklahoma City to house a new maintenance facility. United Airlines executives claimed that the quality of life was far better in Indianapolis, a condemnation that lit a fire under Oklahoma City officials. Enter the Metropolitan Area Projects (MAPS) initiative which, financed by a temporary one cent sales tax, has funded amazing projects to improve the quality of life in Oklahoma City. It's safe to say that living, working and playing in this Southwestern jewel has never been better.
Q2 2015 Oklahoma City Rental Market Update
In Q2 2015, Oklahoma City was the fifth-best rental market in the Southwestern U.S. and 33rd-best in the country as a whole. Since Q1 2015, Oklahoma City fell one spot in the Rental Ranking Report's regional rankings for the Southwestern U.S. and 10 spots in the national rankings.
There isn't a single real estate statistic that paints an overly-flattering picture of the Oklahoma City rental market. Rents increased by a modest 3.88 percent in Q2 2015; while respectable, this rental price appreciation was about 22 percent less than the national average during that period. The same is true for Oklahoma City's Q2 2015 property value appreciation rate of 4.61 percent - hardly horrible, yet still well below the national average. The local vacancy rate (6.80 percent) and annual job growth rate (1.83 percent), two statistics commonly used to assess housing demand, are both slightly worse than their respective national averages.
Regardless, Oklahoma City rental real estate can still be a lucrative investment. The capitalization rate, a metric that compares annual rents to property values that is commonly used by investors to gauge the attractiveness of rental properties, was 6.55 percent in Q2 2015. While slightly below the national average in Q2 2015, this respectable "cap rate" demonstrates that good returns can be made on rental real estate investments there. Furthermore, Oklahoma City's relatively low median age of housing inventory, 52 days (11 days less than the national average) indicates that demand for housing there is at least somewhat strong.
Q1 2015 Oklahoma City Rental Market Update
The Q1 2015 Rental Ranking Report found Oklahoma City to be the fourth-best market for rental real estate investment in the Southwestern U.S. and 23rd-best in the country as a whole. While Oklahoma City didn't excel in Q1 2015 in any of the nine metrics used by the Rental Ranking Report to evaluate the 75 metros it contains, it performed well above average at many of them. For example, OKC's eyebrow-raising year-over-year median rental price appreciation of 3.61 percent was much larger than the national average of 2.71 percent, although it still only ranked 23rd in the U.S. for that metric.
Similarly, the OKC vacancy rate of 4.70 percent was significantly lower than the national average of 7.12 percent, and its 6.73 percent annual property value appreciation was greatly better than the national average of 5.65 percent - but it only ranked 23rd and 24th, respectively, in the nation for those metrics in this quarter's Rental Ranking Report.
Of course, these modest national rankings for the various Rental Ranking Report metrics ultimately mean little, as the numbers themselves indicate that rental property owners are getting solid returns and that now is a wonderful time to invest - perhaps the best time, ever. It would be wise to invest in Oklahoma City rental housing sooner rather than later, before demand drives the cost of purchasing rental housing to even higher levels.
What data is this Rental Ranking Report based on?
To calculate the statistics found in the Q2 2015 Rental Ranking Report, All Property Management gathered data, including the most recent government housing and jobs data, for 75 metros across the United States. Specifically, we looked at home vacancy, capitalization, home value appreciation and job growth rates, changes in rental prices, and the median number of days properties have been on the market to determine which U.S. metros will give investors the highest returns on rental investments. Click here to learn more about the Rental Ranking metrics.
Should I invest in Oklahoma City rental property?
Thinking about renting out a property in Oklahoma City? Save time, avoid hassle and maximize your rental income by having a professional property management company operate your rental property for you. Click here to get a free quote from a local property manager or call 877-780-4510 to have the All Property Management staff get quotes for you.
All Property Management specializes in connecting rental property owners with professional property managers in communities across the United States. These property managers help set rental rates, advertise properties, screen and manage tenants, collect rent, manage vendor relationships and ensure compliance with local, state and federal housing regulations. They take the hassle and worry out of managing rental properties - all while maximizing rental property owners' rental incomes.