Oak Harbor's housing market is closely tied to the naval base. The city offers a mix of older single-family homes near the waterfront and downtown, mid-century and newer subdivisions, and townhome and apartment options, with newer residential development concentrated near the northern city limits and in family-oriented communities popular with military households. Neighborhoods near City Beach Park and Penn Cove blend older homes with vacation-style waterfront properties. Because the base drives steady housing demand, the rental and resale markets remain active, and off-base communities in Oak Harbor and across northern Whidbey Island serve both military and civilian buyers. The market leans toward practical, family-sized single-family homes, with waterfront and view properties commanding a premium along the harbor and cove.

Oak Harbor's neighborhoods fan out from its downtown waterfront. Areas such as Penn Cove Park, Castilian Hills, and Harbor View are frequently cited as family-oriented communities with convenient access to schools. Quiet residential streets near the northern city limits hold newer subdivisions that are especially popular with military families because of their proximity to NAS Whidbey Island. The older core, near the harbor and City Beach Park, features a mix of established homes and waterfront properties with Penn Cove views. Beyond the incorporated area, the surrounding countryside transitions to Whidbey Island's farmland and shoreline communities. The overall pattern is one of a practical, service-oriented town center ringed by a blend of older streets and newer subdivisions, all within minutes of the base and the water.

Oak Harbor's lifestyle is shaped by the Navy and the sea. The presence of Naval Air Station Whidbey Island gives the city a distinctly military-influenced community, with a steady flow of service members and their families, strong support networks, and a population that is more transient than typical small towns. Downtown Oak Harbor offers local shops, restaurants, and a working waterfront along Oak Harbor bay, while Penn Cove and City Beach Park provide in-town water access. The Pacific Northwest Naval Air Museum preserves the area's aviation heritage. Residents balance base life with Whidbey Island's slower island rhythm—fishing, beach walks, and community events—making Oak Harbor a close-knit, patriotic, and outdoors-oriented place to live, with Deception Pass and the island's parks and farms just beyond the city.

Oak Harbor is served by the Oak Harbor School District, which covers the north end of Whidbey Island, including the city, Naval Air Station Whidbey Island, and surrounding areas. The district operates one high school, one middle school, one intermediate school, and five neighborhood elementary schools, a structure that concentrates secondary students in single campuses while keeping younger students close to home. The district educates a significant number of military dependents, and its schools are experienced in supporting the transitions that come with base life. For higher education, Skagit Valley College has a campus in Oak Harbor, providing community college and workforce programs, while the universities of the Puget Sound region are reachable from the island.

Oak Harbor is connected to the mainland primarily by State Route 20, which crosses the Deception Pass Bridge to the north and links to Interstate 5 near Mount Vernon. From the Seattle area, travelers can also take the Mukilteo-to-Clinton ferry onto the southern end of Whidbey Island and drive north along the island's spine. Island Transit provides local bus service across Whidbey Island, including routes to Deception Pass State Park and the Coupeville ferry terminal, but most residents rely on cars for daily travel. Naval Air Station Whidbey Island includes a military airfield, while commercial air service is available through Seattle-Tacoma International Airport and Paine Field. For residents, the defining characteristic is island geography: travel off-island requires either the Deception Pass Bridge or a ferry, shaping both commutes and daily errands.

Oak Harbor sits at the doorstep of some of Washington's finest coastal recreation. Deception Pass State Park, just north of the city, spans both Whidbey and Fidalgo islands and offers the iconic Deception Pass Bridge, sandy and driftwood-strewn beaches, forested trails, freshwater lakes, and campgrounds, with popular spots such as West Beach, Rosario Beach, and Bowman Bay. Within the city, City Beach Park and the Penn Cove waterfront provide swimming, beach access, and scenic views, while boating and fishing are central to local life. The Pacific Northwest Naval Air Museum adds a cultural stop. Farther afield, Whidbey Island's state parks, including Fort Ebey and Ebey's Landing, offer bluffs, trails, and dramatic Puget Sound vistas, making Oak Harbor an excellent base for outdoor recreation in every season.