Birmingham, AL
Is Birmingham a good place to buy rental property in 2026?
HUD Fair Market Rent, FY2026, puts a Birmingham 2-bedroom at $1,266/mo and a 3-bedroom at $1,583/mo. At a stated $265,000 price with the 3-bedroom rent, the sample underwrite below comes to −$574/mo cash flow, a 3.9% cap rate, and a 0.63 DSCR. Whether a specific Birmingham property works depends on its own price, rent, tax bill, and insurance.
Data as of 2026; verify locally before you offer.
Birmingham rent benchmark
HUD Fair Market Rent, FY2026, for the county or metro that contains Birmingham. It is a housing-program benchmark, not a comp for one property. Use it as your starting rent, then replace it with current leases for the address.
| Bedrooms | HUD FMR / month |
|---|---|
| 2 bedrooms | $1,266 |
| 3 bedrooms | $1,583 |
By ZIP code: HUD Small Area Fair Market Rent, FY2026
HUD also publishes ZIP-level rents for the Birmingham-Hoover, AL metro area, the region that includes Birmingham. Rent varies by ZIP and bedroom count.
| ZIP code | 2BR / month | 3BR / month |
|---|---|---|
| 35213 | $1,900 | $2,380 |
| 35209 | $1,580 | $1,980 |
| 35061 | $1,370 | $1,710 |
| 35201 | $1,260 | $1,580 |
| 35261 | $1,260 | $1,580 |
| 35064 | $1,200 | $1,500 |
| 35036 | $1,120 | $1,400 |
| 35074 | $1,070 | $1,340 |
| 35013 | $1,020 | $1,280 |
| 35079 | $1,020 | $1,280 |
| 35180 | $1,020 | $1,280 |
| 35980 | $1,020 | $1,280 |
12 of 133 ZIP codes in the Birmingham-Hoover, AL metro area, sampled highest to lowest.
What the HUD rent pencils to
Sample underwrite at a stated $265,000 price using the HUD 3-bedroom benchmark — not a listing. TrueCap ran its sample deal with $1,583/mo of rent and every other assumption unchanged.
- Monthly cash flow
- −$574/mo
- Cap rate
- 3.9%
- DSCR
- 0.63
Assumptions: $265,000 price, $1,583/mo rent (HUD FMR, 3 bedrooms), 20% down, 6.6% rate, 30-year loan, 3% closing costs, 1.49% property tax, 0.5% insurance, 5% vacancy, 8% management, 5% maintenance, 5% CapEx reserve. Change any of them in the analyzer and the numbers move with you.
Three things to verify locally
- Property tax bill. Pull the parcel's current bill from the county assessor or treasurer, and check how the assessment resets after a sale. The sample above uses 1.49% of price; your Birmingham bill may be higher or lower.
- Rental licensing and permits. Many cities require a rental license, an inspection, or a certificate of occupancy before you can lease. Confirm the Birmingham rules for the address and budget the fees before you close.
- Insurance quotes. Get a written landlord-policy quote for the specific property, including wind, hail, or flood coverage where it applies. Premiums vary by ZIP, building age, and roof.
For the state's starting numbers, see the Alabama guide.
Ready to run a Birmingham property?
Start with Birmingham context, then verify the address, rent, property tax, insurance, and every other assumption. Every assumption is labeled and editable.
Birmingham strategy guides
The terms behind the numbers
Related reading
- How to estimate rent on a rental property (2026) →
- Cash flow vs appreciation: which rental strategy actually wins in 2026? →
- What's a good cap rate for rental property in 2026? →
- Section 8 rentals: how the math actually works in 2026 (pros, cons, underwriting) →
- How to underwrite a rental property in 60 seconds →
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