Jefferson County
House flipping in Birmingham, AL: transfer taxes, property tax and a flip calculator
Every flip in Birmingham pays deed and transfer taxes twice: once when you buy and once when you sell. In Jefferson County they add up to about 0.1% of the price. Here is what each one is, who usually pays it, how property tax works for investors, and a calculator to run your deal.
Projected net profit
$47,476
15.8% margin on ARV over 6 months
Cash needed
$42,524
Return on cash
112%
Max offer
$170,500
$30k profit, 12% margin
70% rule
$160,500
70% of ARV minus rehab with 10% contingency
Where every dollar goes
- Purchase
- $160,000
- Rehab with contingency
- $49,500
- Buy closing costs
- $3,501
- Loan points and fees
- $5,880
- Loan interest
- $9,364
- Taxes, insurance, utilities
- $3,280
- Selling costs
- $21,000
- Total cost
- $252,524
- Break-even ARV
- $248,976
Planning defaults: hard money 11%, 2 points, $1,500 fees, 90% of price and 100% of rehab, interest on drawn funds; 5.5% commission and 1% concessions; state closing and transfer taxes. Not a quote.
Comps, rehab, refi and a verdict for a real address. Your numbers come with you.
Transfer and recording taxes in Birmingham
Who pays: usually the buyer (county probate offices cite Ala. Code 40-22-1); confirm with your closing attorney.
What it costs on a typical flip
- Buy at $200,000: deed and transfer taxes
- $200
- Record a $180,000 purchase loan
- $270
- Sell at $300,000: deed and transfer taxes
- $300
This adds every cited rate on each side, buyer and seller, so you see the full cost of the round trip. Who actually pays each piece depends on custom and your contract. Recording fees and title insurance are extra.
Property tax in Birmingham for investors
Alabama assesses owner-occupied single-family homes at 10% (Class III) but property not otherwise classified at 20% (Class II), so an investor-held house is generally assessed at double the owner-occupied ratio (rental treatment from secondary sources, verify). (source)
For a flip, property tax is part of carrying cost every month you own the house. For a rental, budget the bill the county will send after you buy, not the seller's bill.
Run the numbers
The calculator above uses general closing cost defaults outside Virginia, North Carolina and West Virginia. For Birmingham, add the taxes above to your numbers: about $470 on the buy side and $300 on the sale in this example.
Questions
How much is the transfer tax in Birmingham?
The cited deed and transfer taxes total about 0.1% of the price in Jefferson County. On a $300,000 sale that is about $300. Who pays: usually the buyer (county probate offices cite Ala. Code 40-22-1); confirm with your closing attorney.
Is Birmingham a good place to flip houses?
It depends on the deal, not the city. Buy at a price that leaves room for every cost: closing and transfer taxes on both ends, loan points and interest, carry, commission and concessions. Run the numbers on each house.
Is there a tax on the loan in Alabama?
Yes. Alabama mortgage recording tax: $0.15 per $100 of indebtedness (0.15%), also on deeds of trust.
Facts checked 2026-10-10 against the linked official sources. Tax rates and fees change; confirm them with your closing attorney, title company or the locality. Not legal, tax or lending advice.
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