Birmingham is in the middle of a renaissance – or, as some have dubbed it, a Brummy Bounce.
As one of our most popular articles, this has been updated for 2018.
Birmingham still rides high as the UK's number one city for investment, according to PWC's Emerging Trends in Real Estate Europe 2017: New market realities report, ahead of Manchester, Edinburgh and London. Helping Birmingham to the top spot are big improvements in infrastructure, including the ongoing development of HS2, new tram lines and the redevelopment of New Street Station and opening of Grand Central (commuters can now expect to be in London within an hour).
PWC's report also showed the take-up of over 500,000 square feet in new office space, which includes their own relocation project – from early 2019 PWC will be base their Birmingham operations in the city's £500 million Paradise development, along with other key employers.
It’s also starting to look like an extremely attractive place for buy-to-let investors. While capital growth might not be as high as investors have previously banked on in places like London, the rental yields are strong. So what are Birmingham’s buy-to-let hotspots?
This postcode covers an area to the south west of the city centre, and includes the town of Selly Oak. Because the University of Birmingham is really close, this is one of the most popular student areas.
Trains from Selly Oak station reach Birmingham New Street in 10 minutes, and the area is also well-served by local buses. B29 boasts plenty of shops and bars, and there’s an out-of-town shopping centre called Battery Retail Park.
Recent data from Right Move showed the median asking price for properties as relatively high in Selly Oak at almost £229,000, but strong rental prices mean that landlords can still enjoy good average yields, helped by the booming student population.
The B8 postcode is close to the city centre, and includes Washwood Heath, Saltley, Alum Rock and Ward End. It’s an ethnically diverse area, with a large Asian population. The streets in this postcode are mainly residential, with rows of terraced and semi-detached houses. There are good bus links into the city centre.
Landlords with properties in this part of Birmingham are enjoying rental yields of 7.26 per cent at the time of reporting. The median property price is pretty low at under £150,000, but median rental value is almost £900 a month.
The B44 postcode covers Perry Barr, Kingstanding, and Great Barr, and recent data shows that it’s bringing in rental yields of over five per cent. Perry Barr includes the North Campus of Birmingham City University, so there are big opportunities in student housing.
Lots of Birmingham’s top spots are within easy reach (Villa Park is just down the road), and all of the areas covered by B44 are well served with supermarkets – and, enticingly, there’s also a fair amount of green space.
Property prices are also attractive. A three bed semi-detached house in Great Barr will set you back around £165,000, up eight per cent on the year before but cheaper than nearby Handsworth Wood, which had an overall average price of just over £180,000.
As we’ve seen, Birmingham is attractive not necessarily for capital growth, but instead for rental yields. It’s attracting a lot of inward investment, and there’s talk of several large banks moving there. If you want to make the most of the opportunity, consider the following things:
Are you thinking about investing in buy-to-let in Birmingham? Tell us in the comments.
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