Rent vs buy in Dothan, AL
In Dothan, Alabama, a typical home costs $204,317 and typical rent is $1,210 /mo.
After 7 years, the difference is $2,181, making it a toss-up.
Today's mortgage rate and 20% down are combined with the typical home value and rent for Dothan's market. At year 7, the break-even point is reached.
A clearly labelled opinion with the math shown. These are estimates rather than quoted prices. Adjust any number, and the stamp will adjust too.
- Gap
- $2k after 7 years
- Break-even point
- Year 7 when owning catches up
- Full cost of owning
- $1,747 /mo year 1, against $1,210 rent
Change my numbers
It relies on Dothan's typical home value and rent. Change your rent, your price or your years, and it can flip.
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Enter the rent, price and down payment you want to use. Those figures change the stamp.
Is renting or buying cheaper in Dothan?
Both paths end within $2,181 of each other over 7 years, so small changes settle the outcome. In year 7, owning's net cost falls below renting's and remains lower.
Renting. Owning. Net cost to date, organized by year.
In Dothan: average rent compared with the mortgage payment
Rent and mortgage payments don't tell the whole story. Here are all monthly costs for year 1 at Dothan's typical price.
| Each month, year 1 | Amount | What it is |
|---|---|---|
| Rent | $1,210 | All of it, every month |
| Mortgage payment | $1,114 | $982 of it is interest in year 1 |
| Property tax | $53 | 0.31% of the value a year |
| Insurance | $125 | Census median for the city |
| Upkeep | $170 | 1% of the value a year |
| Owning, cash out | $1,462 | $132 of it builds equity |
| Lost return on the down payment | $332 | At 8.3% a year, this is what the cash would earn |
| Buying costs, spread out | $85 | 3.5% of the price over 7 years |
| True cost of owning | $1,747 | Subtract the equity part from cash out, then add the two earlier lines. |
Dothan verdict: the figures behind it
- Typical home valueZillow ZHVI, September 2026
- $204,317
- Typical rentZillow ZORI, September 2026
- $1,210 /mo
- Down payment20% avoids private mortgage insurance, which the engine does not model
- 20%
- Mortgage rateFreddie Mac Primary Mortgage Market Survey (FRED MORTGAGE30US)
- 7.24%
- Home price growthFHFA house price index, Alabama, 1995 to 2025
- 3.7% a year
- Rent growthCPI rent of primary residence, yearly growth 2006 to 2026
- 3.5% a year
- Return on savings60% S&P 500 with dividends and 40% 10-year Treasuries, rebalanced yearly, 1928 to 2025
- 8.3% a year
- Property taxCensus ACS 2020-2024, Dothan
- 0.31% of value
- Home insuranceCensus ACS 2020-2024, Dothan
- $125 /mo
- MaintenanceFannie Mae, low end of 1% to 4%
- 1% of value a year
- Buying costsFreddie Mac, middle of 2% to 5%
- 3.5% of price
- Selling costsAgent commission plus closing costs
- 6% of price
In Dothan, what would reverse the outcome?
Every line marks the point where Dothan's 7-year verdict changes; everything else stays as it is.
When renting wins
- Home prices grow by less than 3.6% a year (3.7% is the rate we use, Alabama's long-run rate).
- Keeping the mortgage rate above 7.43% meets the condition.
- A home like this one rents for under $1,190 a month, while the typical rent here is $1,210.
- Before year 7, you move.
When buying wins
- Home prices grow by more than 3.6% a year.
- Today's rate is 7.24%; a mortgage rate below 7.43% is what you lock in.
- You'd pay over $1,190 each month to rent the same home.
- Your stay lasts 7 years or more.
Dothan compared with the other 812 cities
| Measure | Dothan | Median city |
|---|---|---|
| Typical home value | $204,317 | $422,451 |
| Typical rent | $1,210 /mo | $1,837 /mo |
| Price-to-rent ratio | 14.1 (#680 of 813) | 18.5 |
| Home prices, last 10 years | 4.6% a year | 6.2% a year |
| Property tax | 0.31% | 0.87% |
| Households that rent | 43% | 42% |
Sources: Zillow ZHVI and ZORI, Census ACS 2020-2024.
More cities in Alabama
- Rent. Renting wins by $30k in Huntsville, AL.
- Buy. Buying wins by $5k in Mobile, AL.
- Buy. Buying wins by $44k in Birmingham, AL.
- Buy. Buying wins by $38k in Montgomery, AL.
- Buy. Buying wins by $26k in Tuscaloosa, AL.
- Rent. Renting wins by $113k in Hoover, AL.
- Rent. Renting wins by $65k in Auburn, AL.
- Rent. Renting wins by $71k in Madison, AL.
- Rent. Renting wins by $22k in Decatur, AL.