A family that has been renting in Montgomery for two years recently received a renewal notice from their landlord. The notice indicated a rent increase, which was more than they expected, leaving them surprised. This situation naturally leads to a thought: wouldn't it be better to buy a home now?

First, let's look at the numbers. According to Zillow, the average home value in Montgomery is $152,082 as of July 2026, which is a 2.2% increase from a year ago. The average rent, based on RentCafe, is $1,094, which has risen by 2.61% compared to last year. Both indicators suggest a gradual increase. This means that Montgomery still has a lower entry barrier compared to the national average. In fact, Zumper reports that Montgomery's rent is 34% lower than the national average.

Calculating the price to rent ratio clarifies the situation further. This ratio is determined by dividing the home price by the annual rent. For Montgomery, dividing $152,082 by $1,094 multiplied by 12 gives approximately 11.6. A ratio below 15 is generally considered favorable for buying. At 11.6, it indicates that buying is often more advantageous in this city.

When we translate this into monthly expenses, it looks like this. Using the 30-year fixed mortgage rate of 6.65% as of August 20, 2026, from Freddie Mac, and assuming a 20% down payment, the monthly principal and interest payment would be about $781. Even when adding property taxes and insurance, the total can often be similar to or even lower than the rent of $1,094. For families who have experienced rent increases at each renewal, this difference can feel even more significant.

However, there is a catch in this calculation. It assumes that you can come up with the down payment and closing costs all at once. If you don't have a lump sum ready, it may be more realistic to continue renting while saving up, even if the rent feels a bit burdensome. Conversely, if you have the funds and plan to stay in the area for more than three years, purchasing a home could lead to a more stable investment.

If the burden of rising rent at each renewal is concerning, it can be helpful to calculate the next renewal point in advance. For example, if we assume the rent increases by 2 to 3 percent each year, it could mean paying an additional $60 to $90 per month in three years. On the other hand, with a 30-year fixed mortgage, the principal and interest payments remain the same throughout the loan term, making long-term budgeting easier. Of course, property taxes and insurance may increase slightly each year, so it's not entirely fixed.

If a Korean family is looking for a home in Montgomery, it's advisable to also consider the school district. School district boundaries change frequently, so if you have a specific address in mind, check the assigned schools on sites like GreatSchools or Niche. If you're moving from another state, it's better to verify Alabama's unique tax structure rather than just basing your budget on the property tax rate from your previous residence.

If you've experienced a sudden rent increase, it can be helpful to review the renewal notice period and the maximum increase clause specified in your lease. Different states and counties have varying minimum notice periods that landlords must adhere to, so knowing this in advance can give you more leverage in future renewal negotiations.

Property tax rates and rental regulations can vary by county. This article is not investment or legal advice, and it is recommended to consult with a professional before entering into any agreements.