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
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.
All figures below are computed from Broken Arrow's real market medians. Use them as a baseline; override with property-specific numbers in the calculators.
At 0.88% effective rate on the $245,000 median price, the annual tax bill is $2,156 — that's near national average (-17% vs the national average of ~1.06%). Verify the actual assessed value before purchase; sale-triggered reassessments can push the bill higher than the seller's current statement.
If Broken Arrow continues appreciating at 2.6%/yr while rents grow at a conservative 3%/yr, cap rate holds roughly steady as price growth outpaces rent. Year-by-year projection at the median:
| Year | Est. Price | Est. Rent/Mo | Cap Rate |
|---|---|---|---|
| Today | $245K | $1,340 | 4.6% |
| Year 1 | $251K | $1,380 | 4.6% |
| Year 2 | $258K | $1,422 | 4.6% |
| Year 3 | $265K | $1,464 | 4.6% |
| Year 4 | $271K | $1,508 | 4.6% |
| Year 5 | $279K | $1,553 | 4.6% |
Same median-priced Broken Arrow property — different capital structures. All-cash maximizes cap rate. Leverage trades cash flow for higher cash-on-cash return when the spread between cap rate and borrowing cost is positive.
| Scenario | Cash Invested | Monthly Cash Flow | Annual CF | Cash-on-Cash |
|---|---|---|---|---|
| All cash | $245K | $930 | $11,160 | 4.6% |
| 20% down conventional @ 7% | $56K | $-373 | $-4,481 | -8.0% |
| 25% down DSCR @ 8.5% | $71K | $-483 | $-5,796 | -8.2% |
Properties don't always trade at the median. Lower-priced units typically offer higher cap rates but harder operations; higher-priced properties tend to compress cap rates while attracting better tenants. All-cash assumptions below:
| Tier | Price | Rent/Mo | NOI/Yr | Cap Rate | Monthly CF |
|---|---|---|---|---|---|
| Below median (~75% price) | $184K | $1,139 | $8,446 | 4.6% | $704 |
| At median | $245K | $1,340 | $9,567 | 3.9% | $797 |
| Above median (~125% price) | $306K | $1,541 | $10,689 | 3.5% | $891 |
Cap rate is just one piece. Real estate returns come from four sources: cash flow, appreciation, principal paydown, and tax benefits. Assuming 20% down conventional financing at 7% and a 5-year hold at Broken Arrow's historical appreciation rate of 2.6%:
On a $49K down payment, that's a 52.7% total ROI over 5 years (not annualized). Tax benefits from depreciation are additional and depend on your personal tax bracket.
Automated checks against the underlying data — surface only the risks that actually apply to Broken Arrow, not generic boilerplate:
Pre-filled with Broken Arrow medians. Adjust to match a specific property.
Factor in financing to see your actual return on invested capital in Broken Arrow.
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.