The entire state of Oklahoma is positioned to take advantage of the current economic expansion. Perhaps even more importantly, however, is the role the Tulsa housing market will play in the state’s return to prominence. Tulsa real estate appears primed to carry over the success it had last year into 2015, and beyond. Forecasts remain positive for several reasons: historically low interest rates, the creation of new jobs, new housing starts, a low unemployment rate and enough land to accommodate an ambitious expansion. These factors, and more, are proof enough that the Tulsa housing market should experience a prosperous 2015.
At the end of last year, Tulsa real estate continued to appreciate with the rest of the country. In fact, over the course of three years, homes in the Tulsa housing market have done nothing but appreciate. That’s right: Tulsa has been the beneficiary of three consecutive years of price growth. Over that period, homes have appreciated by as much as 13.9 percent. And while that rate has tapered to 3.0% in the last year, homes in Tulsa boast a median price of $150,900. At the same time, the national average is just over $215,000. The current median home price across the United States is the result of a 28% appreciate rate over the last three years – nearly twice that of Tulsa.
Again, the Tulsa housing market has been stimulated by an influx of equity. Homeowners in the area are now able to weigh more options. With fewer homes underwater, market activity is inevitable. Some homeowners will be inclined to sell, now that they can afford to do so. Those at the lower end of the market may even be able to move up, if newfound equity permits it. The following highlights how much equity has been gained relative to the year of the home’s purchase:
- Homes purchased in the Tulsa housing market one year ago have appreciated, on average, by $6,583. The national average was $12,783 over the same period.
- Homes purchased in the Tulsa housing market three years ago have appreciated, on average, by $24,720. The national average was $55,406 over the same period.
- Homes purchased in the Tulsa housing market five years ago have appreciated, on average, by $28,455. The national average was $49,675 over the same period.
- Homes purchased in the Tulsa housing market seven years ago have appreciated, on average, by $29,624. The national average was $9,474 over the same period.
- Homes purchased in the Tulsa housing market nine years ago have appreciated, on average, by $44,423. The national average increased $3,419 over the same period.
While not quite on par with leading cities like Seattle or Portland, Tulsa’s job sector remains a stalwart of the local economy. The local economic outlook remains extremely positive, as jobs will continue to support both supply and demand within the housing sector. In fact, Tulsa has one of the lowest unemployment rates in the country. At 4.6%, the unemployment rate in Tulsa is more than a whole percentage point below the national average. The current unemployment rate in Tulsa represents a 1.0% improvement over the course of a year, and experts expect that number to improve. The current 1-year forecast suggests the job growth rate will peak at 1.1 percent.
The strength of the local economy has helped more homeowners get out from underwater. In fact, 2014 was a great year for Tulsans. According to RealtyTrac, 3,135 metro owners in the Tulsa housing market were subjected to the foreclosure process in 2014. That equates to one in every 132 households. However, perhaps even more importantly, that number is considerably less than it was in 2013 – 35% to be exact. The number of foreclosures continues to drop, suggesting things are moving in the right direction. By comparison, the average rate of foreclosures on a national level only dropped 17.9 percent. Experts relate the drop in foreclosures to a stronger job market, increased equity and more of a willingness on behalf of banks to work with borrowers.
As if the previously discussed indicators were not encouraging enough, the Tulsa housing market has one more thing going for it: affordability. With historically high appreciation rates driving up prices across the country, Tulsa remains an intriguing destination for those that can’t afford most other markets. At the end of last year, data revealed that homes in Tulsa, on average, were more than two times more affordable than the national average. While the average homeowner in Tulsa uses about 7.3% of their monthly income to pay their mortgage premiums, the rest of the country allocates 16.3 percent.
Some neighborhoods within the Tulsa housing market are doing better than others, which is no different than any other city. However, Trulia has run the data to determine the most popular neighborhoods in Tulsa:
- Maple Ridge
- Lynn Lane
- Turner Park
- Minshall Park
Of those neighborhoods recognized by Trulia, Maple Ridge and Lynn Lane are the most popular, with listing prices of $541,402 and $209,906 respectively. However, while these neighborhoods are more popular, one particular neighborhood has been making a lot of noise recently. Investors interested in the Tulsa housing market should take a look at Silver Oaks, as the average listing price has increased more than 97% in a one-week period.
While the Tulsa housing market is far from recovered, it is certainly heading in the right direction. Foreclosures have declined significantly, appreciation rates have removed many households from underwater, more jobs continue to be added and interest rates are still low. All of these point to a prosperous 2015 for the city of Tulsa. Experts even expect prices to rise by an additional 1.7% in the coming year. So while it may not be the same market as San Diego, Tulsa looks primed to take the recovery and run with it.
Tulsa Housing Market Summary:
- Current Median Home Price: $150,900
- 1-Year Appreciation Rate: 3.0%
- Unemployment Rate: 4.6%
- 1-Year Job Growth Rate: 1.1%
- Population: 398,121
- Median Household Income: $48,327