Birmingham could be the best place to invest in UK property today
In Birmingham, property for sale is benefitting from exceptional property fundamentals. It has helped the average property price increase by 6% between July 2016 and July 2017 to £185,916 (home.co.uk). Prices are rising faster here than the average in the UK (5.1%), and at more than twice the rate they are rising in London (2.8%). Apartment prices in Birmingham are increasing even faster – by 12% to an average of £155,971 over the same period.
With prices rising, is now the time to invest in property for sale in Birmingham?
Here are three great reasons to invest in Birmingham today:
- If you buy property in Birmingham, you’ll benefit from better-than-average affordability – around 17% below the UK average price of £223,257 (HM Land Registry House Price Index).
- On a buy-to-let investment here, the current average rental yield of 6.4% compares very favourably to the UK average of 5.1%.
- If you buy property today and benefit from leveraging in property investment, you could take advantage of historically low-interest rates (the Bank of England has hinted that the next move is likely to be up).
But these reasons alone aren’t why Birmingham has been named as the UK’s top property investment hotspot by The Emerging Trends in Real Estate 2017 report. You must look deeper to understand just how sustainable property investment in Birmingham is. The fundamentals are fantastic.
1. Incredible shops and leisure amenities
Birmingham is a paradise for shoppers. Mega shopping centres. Big brand names, and independent boutiques. Bustling streets, indoor and outdoor markets. Local produce, and food from around the world. There is a jewellery quarter to rival London’s Hatton Garden, and the Balti Triangle is the heart of Asian fashion in the UK.
There’s an amazing nightlife, and Birmingham offers foodies an incredible array of dining options, from family favourites to some of the best Indian restaurants in the UK. Birmingham is also home to eight Michelin-starred restaurants. Five of these are within the city itself, and three within an hour’s drive.
From the city centre to the surrounding countryside, Birmingham is a place for outdoor entertainment of all varieties, with thousands of acres of park space. Beautiful country parks ideal for walking or cycling include Woodgate Valley Country Park, where you’ll find 450 acres of mixed habitats and all kinds of wildlife.
Like all big cities, there are leisure and sports facilities and opportunities for all. Whether seeking team or individual sports, opportunities exist around every corner.
2. Excellent education establishments
Most children in Birmingham are educated in state schools, with the education provided up to the age of 18. Year 12 and 13 children (16 to 18 years of age) also have the option of attending sixth form colleges or colleges of further education. The state school system is overseen by Birmingham City Council in its role as England’s largest local education authority. It oversees more than 450 schools, covering ages from nursery to sixth form. Other schools include voluntary-aided Anglican, Jewish, and Islamist schools. Around 70% of pupils in state schools in Birmingham now achieve five A to C grades at GCSE level.
With five universities, two of which are ranked in the top 400 in the world by QS World University Rankings, Birmingham houses one of the largest and most highly-educated young populations in the UK.
3. Tremendous transport
Birmingham is a major transport hub, and at the heart of the road and railway network in the UK. 90% of the nation’s population is within four hours’ drive, making it an ideal centre for business. The already exceptional connectivity will be improved further with HS2. Journey times to London by rail will be slashed to less than 50 minutes. It will provide options for inward and outward commuting, as well as improve the movement of goods.
Additionally, Birmingham Airport currently provides an access and exit point for 25 million passengers each year. It makes it the seventh busiest airport in the UK, with flights to most European destinations as well as several long-haul destinations. It will be the only high-speed connected airport in the UK in 2026 and expects unprecedented growth to follow.
4. A thriving and diverse economy
Birmingham’s big economic advantage is its geographic position. Its economy is already growing at a faster rate than the UK average. In 2014, the city’s economic output was £23.2 billion, and this is expected to rise to over £30 billion by 2026.
Start-up numbers are evidence of a creative Birmingham beginning to evolve the local economy. Between 2009 and 2016, there was an increase of 43% in the annual number of start-ups in Birmingham. In the first half of 2016, there were more start-ups in Birmingham than in any other regional city in the UK.
The city is a key destination for London headquartered firms investing in regional cities. These firms benefit from lower costs for premium office space and lower salaries for skilled workers. Birmingham Airport’s proximity to the city also attracts international clients.
Over the next 20 years, the Big City Plan envisages the creation of 80,000 new jobs in Birmingham, helping to support a population expected to grow by 12% or around 134,000 extra residents.
5. Impressive investment
The Birmingham Development Plan sets out a strategy to achieve economic growth. It seeks to regenerate, redevelop and renew the urban area. It has identified some locations that are important in delivering the jobs, supporting activities, and homes required by the city.
Away from the city centre, growth will be focused on opportunity sites and key transport corridors. This network of local centres, housing regeneration sites, and core employment areas located across the city will contribute towards the delivery of new homes, retail, office and employment.
Already, billions of pounds have been invested in regeneration projects in Birmingham, and billions more are being committed or encouraged. Projects to date include:
- The Southern Gateway, a 22-hectare site in the heart of the city. It is a £1 billion project that delivers leisure, retail, food markets, and commercial and residential space.
- £600 million invested in the redevelopment of New Street station.
- £400 million (to date) on the expansion of Birmingham Airport.
- Birmingham Smithfield is a £500 million masterplan to deliver 1,000 new homes, new public spaces, a new Midland Metro tram line, and anew cycle and pedestrian routes.
The regeneration of the area around the planned Curzon Street station is a £900 million project that will lead to the creation of 4,000 new homes, retail, office and commercial opportunities.
Our research indicates that the conclusion drawn by PwC and the Urban Land Institute in their Emerging Trends in Real Estate 2017 report is spot on: Birmingham is the UK’s top property investment hotspot in 2017.
Discover more about Birmingham’s fantastic property fundamentals, and why they provide the perfect environment for a sustainable and successful long-term property investment in Birmingham, by contacting one of the Gladfish team now on +44 (0)207 923 6100.
Live with passion,
Brett Alegre-Wood
