Oklahoma City Cap rate

[Emad Fawzy]

Hi BP community, I am looking to invest in REI in USA, looking at different cities.

What is the average Cap rate for single family and multi Family in Oklahoma City? any advice? 

[Will Fraser]

Salaam Walekum, @Emad Fawzy!  After many years of asking the same question over and over again here is what I'm learned:

Single family:  cap rates are useless in single family in my opinion.  You can cover your debt on many investments in Oklahoma City and then cashflow to varying degrees (from almost nothing to an extreme amount) based on location, type of single family home purchased, and tenant base.  In general, the higher the cashflow you're getting the lower the appreciation.  

Multifamily:  you'll see lower B class to mid C class properties selling at anything between 6.4% and 8.5% cap rate.  8.5% is great, and paying 6.4% for these types of properties seems insane to me and well within the "speculation" zone of local real estate.  New construction retail properties with Class A construction are appraising between 5% and 6.25%, so paying anything close for degraded and wearing out properties is probably not a great idea.

Larger multifamily properties that have recently been repositioned are selling between 5.75% and 6.75%.  

As with all real estate, multifamily properties in OKC vary widely in value based on . . . location, location, and location.

Happy to help with any and all things OKC!