New build property in Birmingham set to be snapped up as the local economy grows
Birmingham. The city with more canals than Venice. The youngest city in Europe. It’s also a city offering huge promise for off-plan property investment.
Birmingham is a mecca for shoppers and has the highest number of Michelin-starred restaurants in the UK outside of London. The city is a centre of culture, boasting its symphony orchestra, a royal ballet, and leading art galleries and theatres. Families benefit from education establishments that produce results above the national average. The 2017 annual Quality of Living Survey (conducted by Mercer) ranks Birmingham as the third best place to live in the UK after London and Edinburgh. Visitor numbers to Birmingham have doubled in the last three years.
For investors in new build, Birmingham’s transport links place it firmly in the list of the best places to invest in property 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 from 80 minutes to less than 50 minutes. Birmingham Airport currently provides an access and exit point for 25 million passengers each year, with plans to expand capacity to 50 million passengers by 2050.
Birmingham is also benefiting from billions in investment, both governmental and private. It includes huge investment commitments from China and the Middle East. The whole fabric of the city and its suburbs are being transformed, helping to place the city in the top league of European cities ideal for investment.
In this article, you’ll learn about Birmingham’s economy and employment. You’ll discover why the city is attracting so much inward business investment. You’ll also learn of a fantastic Crest Nicholson development on the outskirts of the city, which promises incredible investment potential.
The Birmingham economy – benefiting from geographic advantage
Birmingham’s big economic advantage is its geographic position. It is an incredibly well-connected city at the heart of the UK’s transport infrastructure. The road can reach nine out of ten UK businesses and people within four hours. Its economy is already growing at a faster rate than the UK average. In 2014, the city’s economic output was an enormous £23.2 billion.
With massive investment taking place in the New Street Gateway, city centre Metro, in HS2 and Birmingham Airport, the city’s reputation as a location for international business will be enhanced. The potential for economic outperformance to continue is almost set in stone. HS2 is forecast to increase economic output by £4 billion per year.
A diverse economy supported by regional employees
People are prepared to commute if wages are higher in the destination area than they are where they live. From the surrounding areas of the Midlands, approximately 166,000 workers commute into the city of Birmingham. In contrast, fewer than 30,000 of Birmingham’s residents work outside of the city.
However, Birmingham’s ratio of employed working-age Birmingham residents in 2015 was measured at around 62% – some way below the national ratio of 74%. It provides evidence that the skills needed by Birmingham’s employers cannot be found in enough numbers in Birmingham itself. This assumption is further supported by ONS data, which shows Birmingham is above average for little or no qualifications, and below average for qualifications at NVQ1 and higher.
So, Birmingham is sucking in new workers. Despite the skills gap, Birmingham possesses incredible innovation resources. With five universities and internationally recognised research facilities, it is ideally placed to grow in sectors that include engineering, creative industries, low carbon fuel technology, and medical sciences.
Start-up numbers are growing
While the ratio of self-employed people in Birmingham (at 8%) is below that of the UK (10%), startup 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.
Birmingham is a key destination for business
In addition to the rising numbers of start-ups, Birmingham 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.
Inward investment is increasing. In 2015/16, there were 51 inward investment projects – 74% more than the previous year. This inward investment is likely to grow further as the benefits of HS2 come more into focus, and Birmingham Airport expands.
Birmingham’s major sectors include:
- Admin and support services
- Health and social work
- Financial and insurance
- Public administration and defence
- Transport and storage
The visitor economy is growing rapidly
As a core city, it is not surprising that there is a large public sector presence in the city. Key employers include Birmingham City Council, Queen Elizabeth Hospital, and the University of Birmingham. The city also has a greater specialisation than the national averages in jewellery manufacturing.
Key takeaways include:
- More than 45,000 people work in the financial and insurance sector in Birmingham
- There are more than 200 law firms in the city, and all large national law firms have an office in Birmingham
- The Big Four accountants and other top accountancy firms run many global audit relationships from Birmingham
- There is a vibrant banking sector here, which will be bolstered further by HSBC moving its retail bank HQ to the city in 2018
Major employers in Birmingham include:
- Royal Bank of Scotland
- Deutsche Bank
- Ernst & Young
- DLA Piper
- Gowling WLG
- Eversheds Sutherland
Strong growth in economic output is forecast
The Birmingham Economic Information Centre has forecast that the city’s GVA will grow to around £30.4 billion by 2026 – an increase of almost a third of the city’s economic output in 2014, and average annual growth of around 2.3%. It is some way above the growth rate that is forecast for the UK by the IMF, World Bank, United Nations, and European Commission, whose average forecasts range between 1.2% and 1.9% per year through to 2021.
Economic growth underpinned by solid fundamentals
Birmingham is an attractive destination for many companies, and growth will be underpinned by a range of solid fundamentals, including:
- It’s in the centre of the UK
- It has excellent and improving transport connectivity
- Firms here can attract staff from a wide pool of skilled workers
- Inward investment and migration of businesses will serve to encourage the upskilling of the local community
- Lower salaries than London and lower costs of office space are further benefits to firms relocating to or setting up satellite offices in Birmingham
For the property investor, economic growth in Birmingham will encourage population growth, increase the number of jobs, improve salaries and pump up demand for new homes.
Introducing Bourneville Park – contemporary style in a historic setting
Reacting to the evolving UK property market and demand for new build homes, Crest Nicholson has recently added a Midlands Division to its armoury. Bourneville Park is one of the developer’s premier developments in the Midlands.
Situated just five miles from Birmingham city centre, this development comprises a range of contemporary homes from two-bedroom apartments to five-bedroom houses. There is an array of local amenities, including shops, excellent schools, and incredible green space. With a typical ‘village feel’, Bourneville Park is also close to pubs and restaurants.
Birmingham’s heart is only 13 minutes by train, with 144 running daily from the nearby station at Bourneville. By road, the journey time is less than 20 minutes.
Properties on this development also benefit from the attention to detail shown by this multi award- winning house builder. With half a century of experience, Crest Nicholson ensures its properties benefit from exceptional design and build quality.
This year alone, the developer has won awards which include Highly Commended for Best Small Development and Out of London Development at the Evening Standard Awards; Highly Commended Residential at the RICS Awards; LABC Site Manager Award; and Considerate Constructors Award in the £50 million and over category. It has previously won awards for Sustainable Housebuilder of the Year, Best Mixed-Use Development (WhatHouse? Awards), and was the winner of the 2016 Sunday Times Homes Awards’ Best House Design.
This development, and others like it, promise exceptional returns for investors in off-plan Birmingham.
Contact one of the Gladfish team today on +44 (0)207 923 6100 and discover more about the amazing property investment opportunities in Birmingham – the city whose economy is growing faster than the whole of France.
Live with passion,