PwC's Most Investable City in the UK (2022)
298k people educated to degree level – more than any other core city
Located in the UK’s fastest-growing tech sector
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As the UK’s second-largest city and one of the most affordable locations to buy property, Birmingham provides favourable grounds for property investment. Set to welcome over 68,000 new residents by 2040, housing demand is growing. House prices in Birmingham are forecast to rise by 19% over the next 5 years, according to data released in 2022. Coupled with a strong demand for rentals as an affordable alternative to living in London, Birmingham is an attractive choice for buy-to-let investors. Expanding beyond its industrial success as the ‘first manufacturing town in the world’ in 1791, Birmingham is now an economic powerhouse. Many global firms have set up regional offices in the city, bringing in new career opportunities. Start-ups are also in abundance as innovators make Birmingham their home. Because of this, Forbes ranked Birmingham as the 2nd best city in the UK for business start-ups.
As the UK’s second-largest city and one of the most affordable locations to buy property, Birmingham provides favourable grounds for property investment.
Set to welcome over 68,000 new residents by 2040, housing demand is growing. House prices in Birmingham are forecast to rise by 19% over the next 5 years, according to data released in 2022. Coupled with a strong demand for rentals as an affordable alternative to living in London, Birmingham is an attractive choice for buy-to-let investors.
Expanding beyond its industrial success as the ‘first manufacturing town in the world’ in 1791, Birmingham is now an economic powerhouse. Many global firms have set up regional offices in the city, bringing in new career opportunities. Start-ups are also in abundance as innovators make Birmingham their home. Because of this, Forbes ranked Birmingham as the 2nd best city in the UK for business start-ups.
Birmingham’s working population has increased by 21% in the last 22 years, registering 1.15 million residents as of 2022, and is forecast to reach more than 1.2 million (+4%) inhabitants by 2035.
Birmingham's house prices increased by 80% over the past 10 years. The city expects to see a further 35% growth in house prices over the next few years to 2035.
Birmingham’s economy has grown by 122% since the year 2000, totalling £36 billion as of 2022. The economy is expected to expand by a further 63% to reach £59 billion by 2035.
Birmingham is a promising destination for both local and global property investors seeking a diverse range of investment opportunities in residential, and commercial properties. The city has demonstrated a sustained demand for new developments, driven in part by the growing population. Ongoing regeneration projects are the result of the subsequent increase in wealth and economic growth. Birmingham's outlook for future growth remains robust, with projections of continued inward investment further driving demand for properties in this thriving metropolis.
Birmingham has grown from a city of manufacturers into one of innovators. The city’s rapid increase in start-up businesses has substantially contributed to its capital growth. Birmingham was awarded the title of ‘UK’s Regional Start-up Capital’ in 2020 for the seventh year in a row, with 18,394 new enterprises starting life in the city throughout the calendar year.
A large number of international firms have chosen Birmingham as a base for major offices and even headquarters. With the city’s economic success and a pool of educated young professionals needing jobs, Birmingham provides the ideal environment for large-scale investments. Since 2000, the economy has grown by 122% and is expected to grow by a further 63% by 2035.
Birmingham has five universities producing 25,000 new graduates every year. 49% of graduates choose to remain in the city after graduation, making use of alumni connections and the vast range of job opportunities that the city provides.
As a result, Birmingham has a large population of young professionals. 30% of the city’s population is under 25, supporting the city’s healthy rental market. The high demand also adds to the local economy as major companies make use of the population of educated and talented graduates, developing new offices to accommodate them.
Due to the surge of economic growth over the past decades, Birmingham’s population has increased as a result. It is estimated that there are an average of 3,750 new residents per annum, providing a consistently high demand for housing.
The city sees an undersupply of housing and cannot meet the growing demand. As a result, house prices have grown by 80% over the last decade. However, housing in Birmingham is still 34% more affordable than the UK average, making it an attractive option for buy-to-let investors looking for pockets of value.
Due to the burgeoning population of young professionals, the demand for rentals continues to grow. The average rent increased by 15% over the last five years and is expected to grow by a further 19%. Buy-to-let investments will see a strong ROI in the future, especially with Birmingham’s regeneration plans on the horizon.
The introduction of the HS2 high-speed railway line will soon shorten the distance between Birmingham and the UK’s other major cities. The highly anticipated first phase, which will connect the West Midlands (Birmingham) to London, is due to open between 2029 and 2033.
The new transport link will shorten the travel time from 1 hour and 10 minutes via train to 45 minutes. The shorter train journey promises to inject a significant boost to tourism, commerce and the housing market as the commuter belt widens.
The subsequent phases of the HS2 will also link Birmingham to Edinburgh, Sheffield, Liverpool and Manchester. Businesses that have a foothold in multiple locations will benefit from faster travel times, further boosting the economy.
Host to the 2022 Commonwealth Games, Birmingham has been in the spotlight around the world. Birmingham welcomed over one million spectators during the event, which was broadcast across the globe. £778 million was invested into the city to host the games propelling economic growth -creating 35,000 new jobs, a vast amount of tourism, and additional capital through tickets, sponsorships and merchandising.
Birmingham’s establishment dates to the 12th century within the historic county of the West Midlands. The city has come a long way, playing an integral part in the British industrial revolution which laid the foundations for its title as the UK’s Second City. Today, the city’s young and well-educated talent pool combined with Birmingham’s broad economic base provides […]Continue Reading
Many businesses have opted to choose Birmingham as the location for head offices. The most notable firms that have regional offices in the city are:
According to Zoopla, the average rental yield is 6.6%. As property prices are still low compared to London, Birmingham’s average yields are high in comparison.
For this reason, Birmingham offers a reliable ROI on buy-to-let investments as rentals will remain in consistently high demand.
It's important to note, however, that the average rental yield does not take into account individual areas, tenancy agreement types (short-term vs long-term lets) and property size. It is important to consider the rental yield according to comparable properties in the vicinity before making any buy-to-let purchase.
For more information about yields in Birmingham and the city’s rental market in general, our experts can discuss it with you in detail and provide guides. Please don’t hesitate to get in touch to request more information.
Compared to London, Birmingham’s rental prices are considerably more affordable. The average rental price for a one-bed property is £1,052 pcm. In London, the same type of property averages at £2,705 pcm.
Birmingham’s rental prices are predicted to rise by 19% over the next five years, according to JLL.
According to JLL, Birmingham’s house prices are expected to rise by 19% by 2027. The 2022 Commonwealth Games brought the city international success and is a driving force for general interest around the globe. With business booming and the demand for housing continually rising, the city’s economy and infrastructure are healthy and look promising for the future.
Birmingham has great potential for buy-to-let investments. Locations such as Digbeth see interest from investors due to significant regeneration projects in the vicinity offering pockets of value very close to the city centre. Other areas such as The Jewellery Quarter offer a slice of history with a multitude of tastefully restored Grade II Listed Buildings frequently in demand.
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