Birmingham, Alabama

Birmingham home values are more affordable than many other U.S. real estate markets today

• The median price of the average three bedroom home in Birmingham is $110,000. This is 41.18% less than the median value nationwide.
• In the neighborhoods where Real Wealth Network members invest, the median price is only $104,000. This is 5.44% lower than the average three bedroom home in the Birmingham metro and 44.38% less than the average three bedroom home nationwide.
• This shows us that Birmingham real estate is uniquely affordable, especially in the neighborhoods where Real Wealth Network members are investing.

The median rent for homes in Birmingham is higher than more expensive U.S. cities

• The median monthly rent of an average three bedroom home in the U.S. is $1,391, which is 0.74% of the median purchase price of $187,000.
• The median monthly rent of the average three bedroom home in Birmingham is $995, which is 0.90% of the median purchase price of $110,000.
• In the neighborhoods where Real Wealth Network members invest, the median monthly rent of R.E.A.L. turnkey properties is $1,047, which is 1.01% of the purchase price of $104,011.
• This shows us that there’s an opportunity to generate passive monthly cash flow in Birmingham at a slightly higher price-to-rent ratio than the national average.

Birmingham’s real estate market is more stable than many other U.S. markets, which likely makes investing here less-risky

• Over the past five years (2012-2017), the average three bedroom single family home in the Birmingham metro has appreciated at a steady rate of 1.52% per year. This is a slower annual growth rate than the national average of 5.22%.
• In the specific neighborhoods where Real Wealth Network members invest, the five-year appreciation rate is slightly higher at 1.66% per year.
• This shows us that, unlike many U.S. markets today, Birmingham is not experiencing wild appreciation or depreciation swings. This is a good indication that the Birmingham real estate market is more stable than many other markets, which likely makes investing here less risky.

Birmingham rents are rising at a faster rate than the national average

• During the same period (2012-2017) the median rental price for three bedroom single family homes in the Birmingham metro area increased by 2.46% annually, which is just under the national average of 2.67%.
• In the neighborhoods where RWN members invest, the annual rental appreciation rate was slightly higher – 2.84% per year, which is slightly higher than the national average.
• This shows us that Birmingham offers investors a higher price-to-rent ratio than many other U.S. cities today.

Birmingham is experiencing consistent growth year after year

Birmingham is also experiencing some job and population growth, which are both good indicators of a strong real estate market.

• Since 2012, the population in Birmingham has increased at a steady rate of 0.31%.
• Between January 2016 and January 2017, the number of jobs in the Birmingham metro increased at a rate of 0.68%.

This shows us that Birmingham is experiencing consistent growth year after year. And although this growth isn’t staggering, it’s another indicator that Birmingham’s real estate market will continue to be stable in years to come.

In the last few decades, Birmingham has undergone a major revitalization, becoming a hub for publishing, medical research, banking, construction, and service-based companies. The city’s largest private companies include O’Neal Industries, EBSCO Industries, Drummond Co, Inc., and Brasfield & Gorrie, LLC.

Between December 2015 and December 2016 Birmingham created more than 4,900 jobs.

Between December 2015 and December 2016, Birmingham’s job growth rate was 0.68%, which was lower than the national average of 2.31%.

Birmingham is Affordable

• The median price of the average three bedroom home in Birmingham is $110,000. This is 41.18% less than the median value nationwide.
• Home prices in Birmingham are at historically low levels, which means investing here is more affordable than many other U.S. cities today.

Sources:

• https://factfinder.census.gov/
• http://www.deptofnumbers.com/employment/alabama/birmingham/
• https://www.zillow.com/birmingham-al/home-values/
• Real Wealth Network Affiliate Data

Birmingham is Cash Flowing

• The median monthly rent of an average three bedroom home in the U.S. is $1,391, which is 0.74% of the median purchase price of $187,000.
• Three bedroom single family homes in Birmingham can rent for more than 1% of the purchase price, which means there’s a strong cash flow opportunity here.

Birmingham is Stable

• Over the last five years, the average three bedroom single family home in the Birmingham metro has appreciated at a steady rate of 1.52% per year. Although this is lower than the 5.22% annual growth rate nationwide, it’s not necessarily a bad sign.
• It shows us that Birmingham is not experiencing wild appreciation or depreciation swings, which makes it more stable than many other U.S. cities today. This means that investing here is likely less-risky than many other markets too.

Birmingham is Steadily Growing

• Since 2012, the population in Birmingham has increased at a steady rate of 0.31%.
• Between January 2016 and January 2017, the number of jobs in the Birmingham metro increased at a rate of 0.68%.
• This shows us that Birmingham is experiencing consistent growth year after year. And although this growth isn’t staggering, it’s another indicator that Birmingham’s real estate market will continue to be stable in years to come.