Property Investment In Birmingham
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Thanks to its booming economy and property market, Birmingham is one of the most exciting parts of the UK to invest.
Approximately 40% of Birmingham is made up of under 25’s and it is also one of the most ethnically diverse cities in the country. It is predicted that Birmingham’s population will reach 1.3 million by 2039.
Birmingham is also preparing to host the 2022 Commonwealth Games, which will provide a further boost to the local economy. The Commonwealth Games Village, which will serve as accommodation for the athletes, will be converted to residential housing after the games are finished.
As a property investment company, Birmingham regularly features in our consultations with clients. The city has offered brilliant returns for investors so far, and it is expected to continue doing so well into the future.
Why invest in Birmingham?
Birmingham is seen as a top buy-to-let area due to a huge, growing rental demand. It has a thriving business scene driving the demand, with world renowned companies such as HSBC and Deutsche Bank headquartered in the city.
The great thing about property investment in Birmingham is prices are still at an attractive level with room to grow, plus yields are strong. For example, the B9 postcode has an average yield of 5.3%, but an average property value of just £149,031.
Finally, regeneration is ripe and there is a 20-year plan to transform the city centre. Birmingham’s ‘Big City Plan’ is dubbed by the city’s council as the ‘most ambitious, far-reaching development project ever undertaken in the UK’. This will provide 50,000 new jobs, 5,000 new homes and improved infrastructure to meet the needs of new residents.
Types of Property Investment in Birmingham
A low supply of rental properties mixed with increasing demand makes buy-to-let in Birmingham a wise investment choice.
In February 2020, a survey by Simply Business placed Birmingham as joint second with Liverpool as the best place in the UK to invest in buy-to-let property.
With five, popular universities, Birmingham has a student population of around 80,000 – meaning there is a substantial requirement for accommodation.
Plus, Knight Frank reports that Birmingham is one of the top UK cities for overseas students, who favour luxury student properties.
There are different areas in Birmingham to suit a variety of investors, so we have picked out some of the most popular below.
Naturally, Birmingham's city centre is popular with professionals who want to live close to their workplaces and other city centre amenities.
Leaning on the city's industrial past, factory conversions and period properties are popular in the centre (in particular, see the Jewellery Quarter), and they're supplemented by a range of new build blocks.
With the population in the city centre at circa 25,800 and growing, along with an expected yield of 5% (Totally Money), central Birmingham is still a hot spot for property investors.
Digbeth has been tipped as an up-and-coming spot for buy-to-let investment in the immediate future due to its affordability, demand, and expected price growth.
Prices are still at a relatively low entry point and the area could deliver great returns for those who invest early.
Furthermore, Digbeth is subject to more than £2 billion worth of planned development projects over the coming years. It is also within walking distance of HS2’s Curzon Street Train Station, plus the existing Moor Street and New Street stations.
This really is one spot to look out for.
Erdington is located north of the city centre and it is one of Birmingham’s best areas when it comes to affordable housing.
Yields stand at around 5-6%, whilst the current average price paid for a property is £161,360. The affordability of Erdington makes it a tempting place for investors, especially if those considering student accommodation.
It has experienced a price growth of 23.09% over the last five years, with more likely due to ongoing projects like the remodelling of Wilton Indoor Market and the redevelopment of Central Square Shopping Centre.
Perry Barr is another area pipped with great potential.
The Athlete’s Village for the 2022 Commonwealth Games will be built here and after the games it will be transformed to provide 1,400 new homes. Plus, there are planned improvements to public transport, a new railway station, new shops and more, all of which is sure to have a positive impact on the property market.
PropertyData reports that the area has an average yield of 4.6% and average property price of £181,665.
Future Growth in Birmingham
Frequently Asked Questions
Below you can find a range of common questions from previous investors. If you require specific details and advice please do not hesitate to contact us today on +44(0)203 627 3987 or via [email protected]
If you take a look at the current entry level prices, yields and regeneration taking place then it starts to build a great case for capital growth. That coupled with demand vastly outweighing supply explains why JLL have forecast a potential 15% increase in property prices 2019-2023.
According to Zoopla (June 2020), the average price paid for a property in the whole of Birmingham is £205,055. However, if you were looking at just flats then it is £138,648.
The city has seen a 23.08% house price increase in the last 5 years and Hometrack reports a 2.5% year-on-year growth from April 2019-2020.
Birmingham has a good city centre yield of between 4-5% (propertydata.co.uk) and the postcode B44 currently has the highest average yield of 5.4%. Birmingham as a whole is forecast to see rental prices increase by 16.5% through 2019-2023
Yes. Phase one of the HS2 is set to see Birmingham’s travel time to London cut to just 40 minutes and within an hour’s commute to Manchester, Sheffield, Leeds, York, Preston and Wigan.