The Oklahoma Market?

Question

Does anyone do any investing in Oklahoma? I am living in phoenix right now but was born and raised in Oklahoma. I have noticed the phoenix market is completely saturated with investors, however it seems as if the market in Oklahoma is untouched! what are your thoughts?

Would it be better to invest in Oklahoma City or Phoenix?

Alyssa Dyer · Answer

@Ryan Outon

Did you ever pull the trigger on Oklahoma? Just curious how it turned out!

Account Closed · Answer

I invest in single family rentals in Oklahoma City.  I buy foreclosures and rehab them.  I think it's a pretty good market for rentals, but I frequently see posts on Bigger Pockets about investors in other cities finding better deals than I find here.

I can't find houses here that meet the 2% rule - at least not anywhere that I would want to own a house.  I'm happy if I can find houses that rent for around 1.5% of their acquistion and fixup cost.  We have relatively low property taxes (at least compared to Texas) so that helps with cashflow.

I'm sure there are far fewer investors here than in Phoenix, but any decent deal in a desirable part of town that goes up on MLS gets put under contract immediately.

Most of my properties are located in or near the OKC suburb of Midwest City, home of Tinker Air Force Base.  There is a very large tenant pool and home prices are reasonable.  I have read that Midwest City has more NOO houses than owner-occupied houses. Some parts of Midwest City are well-kept and others are pretty rough.

I'm happy to email or talk with anybody who is interested in the OKC market.  Feel free to send me a message.

Deborah Burian · Answer

We have invested in OKC (single family) for 10 years.  It has been a solid, solid market.  We didn't suffer much from this last boom/bust cycle so prices didn't have as far to go down when it occurred.  Oklahoma is a boom and bust town due to the heavy reliance on energy and lately, it's been boom.  The town suffered mightily from the late 80's S&L meltdown that resulted in the Resolution trust purchases and it's sort of sick/funny to see the same properties in foreclosure.  Right now, pretty much since the first of January, properties are selling like hot cakes with multiple bids and even some over-list offers (I've done it myself).  For the last couple of weeks, every property I look at has someone else cruising it. Nonetheless, we are a relatively low cost housing market overall.  Only you can decide how you feel about the long distance aspect.

Now... in the interest of full disclosure, and you can laugh if you want.  I first heard of the "2% rule" at my first REIA meeting three weeks ago.  We just do the math, and if they cash flow, we buy 'em.

James Hiddle · Answer

Yes the markets in OKC and Tulsa are strong as far as the rural areas not sure as I tend to avoid smaller markets due to lack of inventory.

Callum K. · Answer

I have a few properties in the OKC and Tulsa metro and have been purchasing them for several years now and have seen steady increases in home prices and rental rates.  I personally prefer the OK market because they are smaller and seem to be less volatile in comparison to places like AZ, NV, and CA.  We also are not getting the influx of hedge funds and private equity so competition seems to be normal.

Luke W. · Answer

I am currently investing in OKC as well, and have seen some great deals for rentals, but I agree with Jon. Mine cash flow quite well, but I have definitely seen a lot more deals on this site. Then again, most wouldn't post about their mediocre deals unless it were their first. I'm on my phone right now, but I can hopefully answer any of your questions through email, if you're interested. Just PM me. If not, I'll check back later.

Charles Ray · Answer

Based on what I've heard from other investors, I concur with Jon P.  it is tough to find houses that meet the 2% rule.

Ryan Outon · Answer

Dennis Tierney Thats interesting. That just further shows why I shouln't invest in phoenix haha

Dennis Tierney · Answer

I know of a limited partnership here that invests in multifamily in the middle of the country, presently in about 10 states and they have a number of properties in and around Oklahoma City and really like that market. (They have half a biliion under management so know what they're doing)

Ryan Outon · Answer

Well it seems that the better opportunity is in Oklahoma City right now. I am going to continue looking around phoenix, but it seems that the market here is just way to saturated. Thanks for the help guys!