Rainbow City, AL—35906
Real Estate Data & Market Trends
Key Metrics at a Glance
Home Price Trends — Rainbow City, AL
As of Oct '25, the median home price in Rainbow City, AL is $246,000, with a year-over-year change of 1.8%. This indicates that home prices in Rainbow City, AL are increasing. According to Zillow, the 1-year price projection is 1.2%, suggesting an increase housing market in the next year.
Cost per Home Type
| Home Type | Median Home Value | YoY % Change |
|---|---|---|
All Homes | $246,000 | 1.8% |
| Single Family | $246,000 | 1.7% |
| Condos | N/A | N/A |
Cost per Home Size
| Home Size | Median Home Value | YoY % Change |
|---|---|---|
1 Bed | N/A | N/A |
2 Bed | N/A | N/A |
3 Bed | $243,000 | 3.0% |
4 Bed | $343,000 | 3.0% |
| 5 Bed | N/A | N/A |
% of Housing Stock
Rental Trends — Rainbow City, AL
As of July '25, Rentcast reports the average rent in Rainbow City, AL is $1,740, with a year-over-year rent change of -9.8%. Per bedroom, the median rent as of July '25 in Rainbow City, AL is 1-bedrooms: $762, 2-bedrooms: $1,300, 3-bedrooms: $1,800, 4-bedrooms: $3,050. The most common rental property sizes in Rainbow City, AL are 2-bedroom and 3-bedroom, accounting for 56.8% and 19.0% of the rental stock.
| Type | Median Rent | Average Rent |
|---|---|---|
| Average Rent | $1,700 | $1,740 |
| Studio Rent | N/A | N/A |
| 1 Bed Rent | $575 | $762 |
| 2 Bed Rent | $1,300 | $1,300 |
| 3 Bed Rent | $1,700 | $1,800 |
| 4 Bed Rent | $2,300 | $3,050 |
% of Rental Stock
Property Listings — Rainbow City, AL
As of Oct '25, Realtor.com reports that the median days on market for a home in Rainbow City, AL is 84. This is a decrease of 0.0% from last year, suggesting that homes are sitting on the market about the same amount of time than last year. The percentage of listed homes with a reduced price is 29.0%, representing a large inventory and a lot of supply pressure on home prices.
| Metric | Zip Code Average | Year over Year % Change |
|---|---|---|
Median Listing Price | $289,000 | -9.0% |
Listing Count | 35 | 11.0% |
| Listings as % of Homes | 0.8% | 11.0% |
Days on Market | 84 | 0.0% |
Demographics — Rainbow City, AL
As of the latest ACS Survey released in 2023, Rainbow City, AL has a population of 10,400, which has increased by 5.8% over the past 5 years. Rainbow City, AL is a moderately popular place for families, as children make up 22.5% of the population. The area has a poorly educated workforce, with 21.6% of adult residents holding a bachelor’s degree or higher. There are few residents working remotely, with 8.5% reporting working from home.
| Metric | Latest Census | YoY % Change |
|---|---|---|
Population | 10,400 | 5.8% |
% Under 18 | 22.5% | 0.9% |
% Seniors | 18.2% | 0.6% |
% WFH | 8.5% | 97.7% |
% w/ College Degree | 21.6% | -26.3% |
As of the latest ACS Survey released in 2023, Rainbow City, AL is a predominantly white area, with 80.7% of the population identifying as white. The white population has grown by 2.3% in the last 5 years. The second most common race or ethnicity in Rainbow City, AL is black, making up 9.4% of the population. Foreign-born residents account for 5.5% of the population in Rainbow City, AL, and this percentage has decreased by 3.5% as of the ACS Survey 5 years prior, suggesting fewer immigrants are calling the area home.
Race and Ethnicity
| Metric | Latest Census | 5-Year % Change |
|---|---|---|
% White | 80.7% | 2.3% |
% Black | 9.4% | -33.3% |
% Hispanic | 3.9% | -4.9% |
% Asian | 2.5% | 0.0% |
% Foreign Born | 5.5% | -3.5% |
Mortgage and Risk — Rainbow City, AL
According to HUD data as of 2023, there were 153 mortgage originations in Rainbow City, AL, of which 61.0% of loans were conventional mortgages. The average loan-to-value was 68.0%, with 37.0% above 90% LTV (very high). This implies large mortgage risk in Rainbow City, AL. Investor activity is low, as 4.0% of loans were by investors. 10.0% of loans were cash-out refinances, suggesting few homeowners are tapping equity.
Mortgages
| Metric | Zip Code Average |
|---|---|
Total Loan Originations | 153 |
% Conventional Loans | 61.0% |
% Government Loans | 39.0% |
% Investor Loans | 4.0% |
% Second Loans | 1.0% |
% Cash Out Refinance | 10.0% |
Loan Activity
Rentals and Section 8 — Rainbow City, AL
As of 2024, the percent of homes in Rainbow City, AL under the Section 8 program is 10.8%. This is considered low, suggesting that the neighborhood is sparsely composed of Section 8 homes. Section 8 opportunity is good when HUD pays more than market rent. 1-bedroom units appear to be good home sizes to consider for Section 8 housing in Rainbow City, AL, because HUD payments exceed market rent, while 2-bedroom and 3-bedroom and 4-bedroom units do not.
Section 8 Market Size
Total Units under HUD | 148 |
Total Units Section 8 | 148 |
% Rentals under Section 8 | 10.8% |
% Occupied Section 8 | 88.0% |
Section 8 Opportunity
| Home Size | HUD Premium | Market Rent | Max HUD Rent |
|---|---|---|---|
| 1 Bedroom | $425 | $575 | $1,000 |
| 2 Bedroom | -$160 | $1,300 | $1,140 |
| 3 Bedroom | -$280 | $1,700 | $1,420 |
| 4 Bedroom | -$720 | $2,300 | $1,580 |
Affordability — Rainbow City, AL
Home Price to Income Ratio
| Metric | Zip Code Average |
|---|---|
| Home Price to Income Ratio | 3.8 |
| Median Home Price | $246,000 |
| Median Household Income | $58,900 |