The Ultimate Guide to Grading Birmingham Alabama Neighborhoods

Ever since I produced The Ultimate Guide to Grading Cleveland Neighborhoods investors have been bombarding me with requests to make an Ultimate Guide for various other major metro markets that they were interested looking at purchasing turnkey rental properties in.

So I have been teaming up with local Property Managers in each of the popular turnkey markets across the USA and putting together guides for investors to assess the risk of the neighborhoods in these various markets.

To produce The Ultimate Guide to Grading Birmingham, Alabama Neighborhoods that you see below I teamed up with Bigger Pockets members Maureen McCann and Clayton Mobley as they run a very large portfolio of rental properties in the greater Birmingham, Alabama metro area.

KEY

POPULATION: All numbers are estimated to the nearest 1,000th.

OWNER OCCUPIED: The percentage of properties that are occupied by the owner of the property. All numbers are estimated to the nearest 1,000th

AVG INCOME: The average household income.

TAX EXAMPLE: If a home is valued by the county auditor at $100,000 & the Residential Property Tax Rate is 1% the annual taxes will be $1,000.

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A Neighborhoods

The majority of properties in an A neighborhood are owner occupied and rental property investors are highly unlikely to be able to find and purchase rental properties that would cash flow. The price points and quality of properties in these neighborhoods are high and attractive to the most affluent residents of the greater Birmingham, Alabama area.

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Mountain Brook (35213, 35216, 35223, 35243, 35253)

Population 20k

Owner Occupied 86%

Avg Income $204k

Property Tax Rate 0.65%

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Homewood (35209, 35219, 35259, 35226)

Population 25k

Owner Occupied 58.9%

Avg Income $71k

Property Tax Rate 0.65%

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Hoover (35216, 35226, 35236, 35244)

Population 85k

Owner Occupied 68%

Avg Income $107k

Property Tax Rate 0.65%

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Vestavia (35216, 35226, 35243, 35242)

Population 34k

Owner Occupied 75%

Avg Income $99k

Property Tax Rate 0.65%

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Alabaster (35007, 35114)

Population 32k

Owner Occupied 87%

Avg Income $75k

Property Tax Rate 0.51%

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Pelham (35124)

Population 23k

Owner Occupied 82.2%

Avg Income $74k

Property Tax Rate 0.51%

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Calera (35040)

Population 14k

Owner Occupied 85%

Avg Income $64k

Property Tax Rate 0.51%

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McCalla (35111)

Population 16k

Owner Occupied 88.6%

Avg Income $61k

Property Tax Rate 0.65%

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Helena (35022, 35080)

Population 19k

Owner Occupied 94.3%

Avg Income $84k

Property Tax Rate 0.65%

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B Neighborhoods 

Properties in B neighborhoods are the highest quality rentals investors can target that will still pencil out from a cash flow perspective. These properties typically feature wide open spaces, a convenient commute to work as well as favorably rated schools, which is a big draw for stable, family-minded tenants.

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Moody (35004, 35094, 35120)

Population 13k

Owner Occupied 78.2%

Avg Income $61k

Property Tax Rate 0.34%

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Leeds (35004, 35094)

Population 12k

Owner Occupied 80.4%

Avg Income $60k

Property Tax Rate 0.65%

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Gardendale (35071, 35116, 35117, 35119)

Population 14k

Owner Occupied 82.4%

Avg Income $63k

Property Tax Rate 0.65%

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Fultondale (35068, 35207)

Population 9k

Owner Occupied 71.2%

Avg Income $58k

Property Tax Rate 0.65%

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Forestdale (35214)

Population 10k

Owner Occupied 79.1%

Avg Income $52k

Property Tax Rate 0.65%

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Pleasant Grove (35224, 35127)

Population 10k

Owner Occupied 87.9%

Avg Income $65k

Property Tax Rate 0.65%

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Adamsville (35005, 35062, 35224)

Population 4k

Owner Occupied 77.1%

Avg Income $49k

Property Tax Rate 0.65%

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Grayson Valley (35235)

Population 6k

Owner Occupied 71.1%

Avg Income $50k

Property Tax Rate 0.65%

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Irondale (35210)

Population 12k

Owner Occupied 71.2%

Avg Income $50k

Property Tax Rate 0.65%

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Pinson (35126)

Population 8k

Owner Occupied 86%

Avg Income $61k

Property Tax Rate 0.65%

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Trussville (35173, 35235, 35004)

Population 22k

Owner Occupied 89.1%

Avg Income $87k

Property Tax Rate 0.65%

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C Neighborhoods

These are areas where real estate investors can get a lot of bang for their buck. C Neighborhoods consist of a healthy mix of owner occupied properties and rentals. There are still some fantastic parts of these zip codes but there will also be a higher level of risk then you see when investing in B Neighborhoods.

Center Point (35215)

Population 16k

Owner Occupied 54.5%

Avg Income $39k

Property Tax Rate 0.65%

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Hueytown (35023, 35061)

Population 15k

Owner Occupied 70.2%

Avg Income $45k

Property Tax Rate 0.65%

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Bessemer (35020, 35021, 35022, 35023, 35111)

Population 26k

Owner Occupied 55.1%

Avg Income $31k

Property Tax Rate 0.65%

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Graysville (35005, 35062)

Population 2k

Owner Occupied 84.2%

Avg Income $46k

Property Tax Rate 0.65%

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Jasper (35501, 35502, 35503, 35504)

Population 14k

Owner Occupied 65.5%

Avg Income $40k

Property Tax Rate = 0.33%

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Warrior (35091, 35180)

Population 3k

Owner Occupied 79.6%

Avg Income $28k

Property Tax Rate = 0.65%

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D/F Neighborhoods

Rental occupancy starts to outweigh owner occupancy. Low price points. High unemployment and crime rates. Can be very difficult to place qualified tenants.

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Tarrant (35217)

Population 6k

Owner Occupied 56%

Avg Income $27k

Property Tax Rate = 0.65%

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Fairfield (35064, 35224)

Population 11k

Owner Occupied 58.4%

Avg Income $36k

Property Tax Rate = 0.65%

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Ensley (35218)

Population 7k

Owner Occupied 38.28%

Avg Income $27k

Property Tax Rate = 0.65%

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East Lake (35206)

Population 1k

Owner Occupied 42%

Avg Income = $26k

Property Tax Rate = 0.65%