How can you profit from property investment in Birmingham?
4 steps to take advantage of Birmingham’s potential
Birmingham is a city with huge appeal to its residents. It offers some amazing shopping, great restaurants and bars, and a fantastic nightlife. It’s a city with a rapidly growing and young population, and five universities supporting the education of 65,000 students. With a diverse and growing economy, home to many national and international businesses, and boasting one of the fastest rates of new business start-ups in the UK, the number and quality of jobs available here is encouraging many more people to make Birmingham their home. In 2017, more people migrated out of London to Birmingham than to any other UK city.
A city is a place where savvy investors are buying property, with regeneration pumping Birmingham property prices. If you are considering investing in property in Birmingham, we think you are about to make a good decision. But how good that decision will be depends on investing wisely. These four steps will help you take advantage of the very real potential for property investment in Birmingham.
1. Do your research to pick the best location
Most locations in Birmingham are in high demand. However, we think four city centre locations are standout areas. These locations allow investors to take advantage of the growth in the population of young professionals who want to live on the doorstep of all Birmingham’s fantastic amenities. They are:
- Digbeth, a trendy location with great transport connections and some exciting regeneration going on. Here you’ll find an eclectic mix of bars, bistros and cafés. Young professionals are attracted by the modern contemporary apartment-style living being developed here.
- Southgate & Highgate is home to the Chinese Quarter and Birmingham Gay Village. It’s a vibrant and diverse area of the city undergoing massive redevelopment of its wholesale market. Here, vacant land and derelict buildings are being transformed with open spaces and a fantastic residential offering which is ideal for young professionals and families.
- The Jewellery Quarter is a well-connected and vibrant place to live, work and play. It is packed with character as a result of its more than 200 listed buildings, and could be described as the cultural heart of Birmingham; here is where you will find museums and galleries as well as some amazing eating and drinking options. Only a few minutes’ walk from the best of Birmingham, the Jewellery Quarter is uber trendy and offers younger residents a relaxed or lively nightlife, whichever the preference. Property investors here benefit from a good rental yield and affordable entry level.
- Westwood and Ladywood is an area supporting more than 200,000 jobs. 130,000 people live here. This really is one of the most popular areas of Birmingham. It is where you will find The Cube and Brindleyplace, and the International Convention Centre. There is huge potential here, with more regeneration to come.
2. Run your numbers
Always project your cash flow before investing in property. Take a deeper look at the locations in Birmingham in which you are considering an investment, and do your research to find out actual rents that are being achieved in the location. Speak to letting agents and ask about average void periods and length of tenancy. If all the numbers stack up, then move to the next step.
3. Consider future value
Like most other cities in the UK, Birmingham is short of property. Demand for homes outstrips supply, and unless and until this equation balances out, the pressure on prices will be up. Another consideration is that when High-Speed Rail services start operating, London will be less than 50 minutes away. Birmingham may become a commuter town!
Hometrack has forecast that property prices in Birmingham are likely to rise between 20% and 30% in the next three years. That’s some real growth potential.
4. Should you buy off-plan property in Birmingham?
When you buy off-plan property, you should be able to negotiate a discount to the current market price (we do this for our investors, and because we negotiate in bulk, we tend to get the best discounts). You’ll be able to pay down a lower initial deposit, and stage payments as the build progress. By the time the property is completed in, let’s say, two or three years, you could be sitting on a property that is worth 20% to 30% more than you paid (perhaps even more) if Hometrack’s assessment and forecast prove to be correct.
How do you buy off-plan property in Birmingham?
If you have never invested in off-plan property previously, it can be a daunting prospect. We’ve helped hundreds of beginner investors take those first steps, ensuring that they pass the sleep test – which says don’t do anything that makes you sleep poorly.
If you’re considering investing in off-plan property in Birmingham but aren’t sure if it’s for you, download your free copy of our eBook ‘Profiting from Off-Plan Apartments’. This is the definitive guide for property investors buying off-plan apartments and will help you to maximise your profits while minimising risks.
Otherwise, to find out more and receive an in-depth appraisal of the best property investment opportunities in Birmingham, get in touch with Gladfish today.
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