Average capitalization rate in Alabama, United States

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Capitalization rate description

A percentage that shows the potential annual return on a real estate investment based on the property's income.

The cap rate helps investors quickly assess and compare the profitability of different property investments.

\(\text{Cap Rate} = \frac{\text{Annual Rental Income} - \text{Annual Expenses}}{\text{Total Purchase Price}}\)

A higher cap rate suggests a potentially more profitable investment, though it should be considered alongside other financial metrics.

Average capitalization rate for residential properties in Alabama

MedianMeanMode
7.4%
From 2,768,974 homes
8.0%
From 2,768,974 homes
-

Data updated November 14, 2026

Average capitalization rate for residential for cities in Alabama

LocationMedianMeanMode
Abanda
8.7%
From 108 homes
8.3%
From 108 homes
-
Abbeville
6.9%
From 1,544 homes
6.8%
From 1,544 homes
-
Adamsville
12.4%
From 449 homes
12.4%
From 449 homes
-
Addison
3.9%
From 512 homes
4.1%
From 512 homes
-
Akron
7.2%
From 297 homes
7.4%
From 297 homes
-
Alabaster
8.5%
From 14,855 homes
8.4%
From 14,855 homes
-
Albertville
7.3%
From 7,695 homes
7.2%
From 7,695 homes
-
Alexander City
7.5%
From 14,381 homes
7.5%
From 14,381 homes
-
Alexandria
5.3%
From 2,172 homes
5.6%
From 2,172 homes
-
Aliceville
8.3%
From 1,510 homes
8.4%
From 1,510 homes
-

All cities in Alabama