Alabama cost of living
Moving to a new state is a mix of emotions — it can be full of new possibilities but also challenging and a bit scary. While a fresh start offers exciting opportunities and experiences, it's important to consider the practical side of things, too. Building new friendships, finding support and getting to know your way around takes time.
Moving can also be costly and emotionally draining. Whether you're relocating to Alabama for a job, a change of scenery or any other reason, understanding the cost of living in the state is crucial for a smooth transition.
The median rent in Alabama is $1,345.38, versus the national median rent of $1,529.01.
Jump to insightResidents in Alabama spend $271.64 weekly on food at home and $110.06 on food out.
Jump to insightAs of publishing, the average price per gallon of regular gas is $3.09 in Alabama.
Jump to insightRecent data shows that employees in Alabama pay $1,799 annually for employee-sponsored health insurance coverage.
Jump to insightHousing costs in Alabama
According to recent data from Zillow, the median rent in Alabama is $1,345.38, while the national median rent is $1,529.01.
Data from the U.S. Census Bureau shows rent prices in Alabama broken down by home size. As of publishing, one-bedroom apartments in Alabama had a median cost of $783 per month, and the two-bedroom median cost was $846 per month. Three- and four-bedroom homes had median costs of $1,065 and $1,146, respectively.
As of publishing, the median home price in Alabama is $272,000, according to Redfin. The U.S. median home price is $436,000.
Alabama ranks No. 49 for highest effective property tax rates in the nation, according to the most recent Tax Foundation data, at 0.40%.
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Food costs in Alabama
According to recent census data, the average spent weekly on food to prepare at home in Alabama is $271.64, compared with the U.S. average of $270.21 at the time. Alabama residents spend an average of $110.06 weekly on food prepared outside the home, compared with the U.S. average of $109.21.
Transportation costs in Alabama
According to recent data from AAA, the average price per gallon of regular gas in Alabama is $3.09, compared with the U.S. average of $3.46.
The most recent National Association of Insurance Commissioners data shows that the average auto insurance premium (liability, collision and comprehensive coverage combined) in Alabama is $1,087.61, versus the national average of $1,189.50.
Public transportation costs
The Alabama Department of Transportation, in partnership with transit providers, offers public transportation via buses in both urban and rural locations across the state. Fares can vary based on the transit provider and city, but the average fare per public transit in Birmingham was 83 cents in 2022, putting it at No. 20 in our list of cities with the best public transit in 2024.
Health care costs in Alabama
The most recent KFF data shows that, on average, employer-sponsored health insurance cost Alabama employees $1,799 annually, with employers covering the remaining $4,970 of the $6,769 total cost.
Nationwide, the average employee contribution was $1,637 out of a total premium of $7,590.
Utility costs in Alabama
According to the most recent data from the Energy Information Administration, the average monthly electric bill in Alabama is $167.80, versus $135.25 countrywide.
Recent EIA data also shows that natural gas in Alabama costs $16.71 per thousand cubic feet, compared with $13.25 nationally.
FAQ
Does Alabama have a high cost of living?
Overall, the cost of living in Alabama is lower than the national average. In particular, the cost of housing, which generally makes up the largest portion of monthly expenses, is lower than U.S. averages for both buying and renting.
What are the most expensive cities in Alabama?
It’s more expensive to live in the large metro areas of Alabama, like Huntsville and Birmingham, where median home prices tend to run higher.
What other expenses should I consider when moving to Alabama?
Alabama is prone to inclement weather, including hurricanes. Depending on where you live in the state, weather-related expenses (e.g., boarding up windows, generator use for power during storms) may be something to consider, especially for potential homeowners.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Zillow, “Housing Data.” Accessed May 14, 2024.
- Redfin, "Redfin Data Center." Accessed May 14, 2024.
- Tax Foundation, "Where Do People Pay the Most in Property Taxes?" Accessed May 14, 2024.
- United States Census Bureau, "Week 63 Household Pulse Survey: October 18 - October 30." Accessed May 14, 2024.
- AAA Gas Prices, "State Gas Price Averages." Accessed June 14, 2024.
- National Association of Insurance Commissioners, "2020/2021 Auto Insurance Database Report." Accessed May 14, 2024.
- KFF, "Average Annual Single Premium per Enrolled Employee For Employer-Based Health Insurance." Accessed May 14, 2024.
- U.S. Energy Information Administration, "2022 Average Monthly Bill- Residential." Accessed May 14, 2024.
