Broken Arrow, OK Cap Rate: 4.56% — Rental Property Analysis
Broken Arrow is a budget-friendly market in the South with a smaller market with 115,000 residents. At a 4.56% estimated cap rate, this is a moderate market where rents of $1,340/mo lag behind home prices. With a median home price of $245,000 and steady population growth supports long-term rental demand, Broken Arrow offers opportunities for investors who source deals carefully.
Market data powered by Zillow Home Value Index (ZHVI) and Zillow Observed Rent Index (ZORI) · Updated Feb 2026
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Moderate — source deals carefully
Based on $245,000 median price and $1,340/mo median rent
Est. Cap Rate
4.56%
1% Rule
0.55%
Fails
GRM
15.2x
Price / Income
3.6x
Market Data
Median Home Price$245,000
Median Monthly Rent$1,340
Property Tax Rate0.88%
Population115,000
Population Growth1.2% / yr
Median Household Income$68,200
Vacancy Rate5%
Annual Appreciation2.6%
2026 Market Update: Broken Arrow
Broken Arrow's 0.5% rent-to-price ratio is well below the 1% rule. At median prices of $245,000, the $1,340/mo rent produces only $930/mo in NOI. Investors here need to target below-median properties or pursue value-add strategies to make the numbers work.
At current rates, a 20% down conventional loan ($49K at 7%) would result in approximately $-373/mo cash flow — negative at median prices. Larger down payments, seller financing, or buying 15–25% below median are strategies to turn the numbers positive.
The 15.2x gross rent multiplier and 5% vacancy rate position Broken Arrow as a balanced market. With annual appreciation at 2.6%, total returns (cash flow + equity growth) run approximately 7.2% before financing leverage.
Cap Rate Calculator — Broken Arrow
Pre-filled with Broken Arrow medians. Adjust to match a specific property.
Property Details
$
$
3–8% typical
%
Monthly Expenses
0.88% rate
$
$
8–10% of rent
$
8–12% of rent
$
Cap Rate
3.77%Low
Net Operating Income ÷ Purchase Price
NOI / Year
$9,240
net operating income
Gross Rent Multiplier
15.2x
High (>15)
1% Rule
0.55%
✗ Fails
Monthly Cash Flow
$770
before debt service
Annual Breakdown
Gross Rental Income$16,080
Less Vacancy−$804
Effective Income$15,276
Less Operating Expenses−$6,036
Net Operating Income$9,240
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Factor in financing to see your actual return on invested capital in Broken Arrow.
$
$61,250
%
%
years
$
taxes + ins + maint + mgmt
$
$
Cash-on-Cash Return
-7.36%Weak
Annual Cash Flow ÷ Total Cash Invested
Total Cash Invested
$68,600
$61,250 down + $7,350 closing
Monthly Mortgage
$1,198
on $184K loan
Monthly Cash Flow
$-421
after all expenses
Annual Cash Flow
$-5,051
before taxes
Cash Flow Breakdown
Monthly Rent$1,340
Less Expenses−$563
Less Mortgage−$1,198
Monthly Cash Flow$-421
Is Broken Arrow a Good Place to Invest in Rental Property?
Broken Arrow, OK has a population of 115,000 and has been growing at 1.2% annually — above the national average, suggesting steady demand pressure on housing. The median home price of $245,000 paired with median rents of $1,340/mo produces an estimated cap rate of 4.56%.
Property taxes at 0.88% fall within the national average range and shouldn't present unusual challenges. The vacancy rate of 5% is moderate and within normal parameters for a healthy rental market.
At a price-to-income ratio of 3.6x, homes cost about 3.6 times the local median income of $68,200. This relatively affordable ratio suggests a deep pool of renters who find buying out of reach, supporting rental demand. Home values have appreciated at roughly 2.6% annually. Steady appreciation means total returns will be primarily cash flow-driven — the more sustainable model for long-term wealth building.
Bottom line: Broken Arrow presents moderate opportunities. Cap rates near 4.56% mean deals need careful sourcing — look for value-add rehabs or emerging neighborhoods where rents are climbing.
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