Summary:
– Oklahoma City homeowners face $19,858 annually in hidden costs.
– Insurance tops the list, costing $7,085 in Oklahoma City.
– Tulsa is slightly cheaper at $17,819, but insurance remains high.
Oklahoma’s two largest cities should rank among America’s most affordable places to own a home. With median home values well below $250,000, modest property taxes and reasonable maintenance costs, Oklahoma City and Tulsa offer entry points into homeownership that residents of coastal cities can only dream about.
But rising insurance premiums are erasing those advantages, according to new research from PropFusion that analyzed hidden homeownership costs across the nation’s 50 most populous cities.
Oklahoma City homeowners pay $19,858 annually in expenses beyond their mortgage payments, while Tulsa residents face $17,819 in hidden costs. The primary culprit in both cities is homeowners insurance, which has reached high levels throughout Tornado Alley.
“Oklahoma City should be one of the most affordable markets in America,” said Stuart Wilkinson, real estate expert and co-founder of PropFusion. “Homes cost $203,000, property taxes are reasonable at $2,636 annually, and maintenance runs just over $4,000. But then you get hit with a $7,085 insurance bill because you’re in Tornado Alley. That’s more than what homeowners pay in property taxes and maintenance combined.”
The PropFusion study incorporated data from Zillow, the Lincoln Institute, NerdWallet and Doxo Insights to calculate total annual costs including property taxes, insurance, utilities and a standard 2 percent maintenance allowance.
Oklahoma City’s insurance burden
Oklahoma City homeowners pay $7,085 annually for homeowners insurance, the highest among all 50 cities analyzed. That figure is nearly triple the national median of $2,530 and represents roughly one-third of the city’s total hidden costs.
The insurance burden becomes even more obvious when compared with other markets. In San Jose, California, homeowners pay just $1,090 to insure properties worth $1.38 million, more than six times the value of Oklahoma City homes. That means Oklahoma City residents pay nearly seven times as much for insurance on properties worth a fraction of the price.
Despite having the fifth-cheapest median home value in the study at $203,240, Oklahoma City ranks 28th overall in total hidden costs, landing squarely in the middle of the 50-city list. The city’s favorable position in other categories, including the eighth-lowest property taxes at $2,636 and below-average maintenance costs at $4,065, cannot overcome the insurance disadvantage.
The insurance premium represents 3.49 percent of the average Oklahoma City home’s value, while San Jose homeowners pay just 0.08 percent. This disparity reflects the severe weather risks associated with central Oklahoma, where tornadoes, hail and wind cause billions of dollars in damage annually.
Tulsa fares somewhat better
Tulsa residents face a lighter burden than their Oklahoma City neighbors, paying $17,819 in annual hidden costs. That figure places Tulsa 39th among the 50 cities, positioning it among the more affordable markets in the study.
Insurance remains the primary concern in Tulsa, with homeowners paying $5,250 annually. While substantial, that represents a 26 percent savings compared to Oklahoma City premiums.
Tulsa’s median home value of $212,641 is slightly higher than Oklahoma City’s, and property taxes run $2,832 annually. Utility costs come in at $5,484, and maintenance costs total $4,253 based on the 2 percent standard.
The challenges facing Oklahoma homeowners reflect a regional pattern affecting Texas and other central states. Houston homeowners pay $6,370 annually for insurance, while Fort Worth residents pay $5,825. Insurance costs in these markets are transforming affordable housing into a financial strain for many families.
The national median for hidden homeownership costs is $20,403 annually. Home maintenance represents the largest single category at 37.71 percent of hidden costs, followed by utilities at 29.36 percent, property taxes at 20.67 percent and insurance at 12.26 percent. However, in Oklahoma and Texas markets, insurance consumes a disproportionate share of the budget.
A regional challenge
The insurance crisis affecting Oklahoma and neighboring states shows no signs of abating. Climate patterns continue to produce severe weather events, and insurers have responded by raising premiums or withdrawing from certain markets.
This reality presents challenges for economic development officials seeking to attract new residents with promises of affordable living. While Oklahoma home prices remain attractive compared to coastal markets, the hidden costs of ownership tell a more complicated story.
Philadelphia leads the nation as the most affordable city for hidden homeownership costs at $14,284 annually, while San Jose tops the list at $54,562. Oklahoma’s cities fall in between, with Tulsa offering relative affordability and Oklahoma City demonstrating how insurance costs can neutralize advantages in other categories.
