Birmingham Real Estate Market 2021

Birmingham Real Estate Market Trends & Statistics 2021

Data Sources:

• https://factfinder.census.gov/
• http://www.deptofnumbers.com/
• https://www.zillow.com/
• RealWealth Property Team Data

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

• The median price of the average home in Birmingham was $177,900 in 2020. This is 30% less than the median value nationwide.
• In the neighborhoods where RealWealth members invest, the median home value is $119,600. This is also 53% less than the average  home nationwide.
• This shows us that Birmingham real estate is uniquely affordable, but perhaps this won’t be the case for long.

The median rent to purchase price for homes in Birmingham is higher than the national average.

• In 2020, the median monthly rent of an average home in the U.S. was $1,700, which is 0.68% of the median purchase price of $254,000.
• The median monthly rent of the average home in Birmingham was $1,145 in 2020, which is 0.64% of the median purchase price of $177,900.
• In the neighborhoods where RealWealth members invest, the median monthly rent of R.E.A.L. Income Properties™ was $1,100 which is 0.92% of the median purchase price of $119,600.
• This shows us that there’s an opportunity to generate passive monthly cash flow in Birmingham at a significantly higher rent-to-purchase 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 last six years, the average home in the Birmingham metro has appreciated by over 30% compared to 36% nationally. While this equity growth is slower than the national average, it shows us that homes in Birmingham are still appreciating at a solid rate.

Birmingham rents have been rising consistently over the last six years.

• Between 2014 and 2020, the median rental price for average homes in Birmingham has appreciated by 17% metro-wide. Nationally rents appreciated 23% during this period.
• Although rents have not risen as fast as some U.S. metros, it’s important to note that Birmingham has a much higher rent to purchase ratio than the national average. The median home in Birmingham rents for just 0.92% of the purchase price. Nationally average homes only rent for 0.68% of the purchase price.
• This information, coupled with the home value data above, shows us that Birmingham is growing consistently. Although home values and rents haven’t risen as quickly as other U.S. metros, they have been rising. This combined with the fact that Birmingham offers a strong rental income potential make it a strong place to invest.

Birmingham is experiencing consistent population growth year after year.

• Since 2010 the population in Birmingham has increased by 2.70%, which is about 56% slower than the national average. Although Birmingham’s population hasn’t grown as quickly as other U.S. markets, it has been growing consistently. This is a promising sign for investors looking to invest in a market with more stability.

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 November 2019 and November 2020 the number of jobs in the Birmingham metro decreased at a rate of 4.37%, which is 28% better than the national average.
• This shows us that Birmingham has lost less jobs than other U.S. cities today, which is a good sign for real estate investors. Why? Because a stable job market makes investments in the area less-risky. In a typical year,  job growth in Birmingham is strong, which leads to population growth, and people always need a place to live.

The Birmingham real estate market is affordable.

• The median price of the average home in Birmingham was $177,900 in 2019. This is 30% less than the median value nationwide.

Birmingham’s housing market is offers cash flow opportunities.

• The median monthly rent of the average home in Birmingham was $1,145 in 2020, which is 0.64% of the median purchase price of $177,900. This is higher 5% below the U.S. price to rent ratio of 0.68% during this period.
• In the neighborhoods where RealWealth members invest, the median monthly rent of R.E.A.L. Income Properties™ was $1,100 which is 0.92% of the median purchase price of $119,600. This tells us that there are cash flow opportunities around the Birmingham metro.

Birmingham is Stable

• Over the last six years, the average home in the Birmingham metro has appreciated by over 30% compared to 36% nationally.
• The median rental price for average homes appreciated by 17% metro-wide during this period compared to 23% nationally.
• Although rents have not risen as fast as some U.S. metros, it’s important to note that Birmingham has a much higher rent to purchase ratio than the national average. The median home in Birmingham rents for 0.92 of the purchase price. Nationally average homes only rent for 0.68% of the purchase price.

Birmingham is Steadily Growing

• Since 2010 the population in Birmingham has increased by 2.70%, which is about 56% slower than the national average. Although Birmingham’s population hasn’t grown as quickly as other U.S. markets, it has been growing consistently. This is a promising sign for investors looking to invest in a market with more stability.
• Between November 2019 and November 2020, the number of jobs in the Birmingham metro decreased at a rate of 4%, due to COVID-19. Compared to the national average job loss rate of 6%, Birmingham fared better higher than most U.S. cities.