Birmingham was named as one of Europe’s top locations for property investment, and takes the number one spot amongst UK cities, beating London, Manchester and Edinburgh, according to The Emerging Trends in Real Estate 2017 report.
So, what factors makes the investment experts so confident about Birmingham’s ability to deliver strong returns to investors?
1. Regeneration of property and investment
Birmingham’s regeneration has been underway for a while. Recent projects have included:
• With massive investment in the New Street Gateway, city centre Metro and Birmingham Airport, the city’s reputation as a location for international business is being enhanced
• The Birmingham New Street station, with a £600 million upgrade completed in late 2015
• The Curzon Investment Plan released in late 2016 provides a £900 million commitment to regenerate the area around the planned HS2 Curzon Street station. Part of this project will deliver 4,000 new city centre homes
2. Future city plans
In January 2017, Birmingham City Council adopted the Birmingham Development Plan (BDP) 2031. The BDP guides decisions on regeneration and will help the delivery of 51,000 new homes to house the expected population growth of 150,000 by 2031.
The Council also plans to deliver millions of square metres of new office and retail space. The BDP incorporates the Big City Plan with strategies to revitalise available sites in and around Birmingham.
3. Centre for business
Birmingham has a significant economic advantage due to its geographic position; nine out of 10 UK businesses can be reached by road within four hours. Is also has the largest business hub outside London, and Birmingham’s economy is growing at a faster rate than the UK average.
Britain’s largest bank HSBC is moving its UK headquarters to Birmingham from London, with its new 10-storey £200m office in Centenary Square due to open in January 2018. The bank plans to move more than 1,000 jobs from its London offices by the end of 2017, adding to its existing 2,500 local Birmingham staff.
4. Transport links
High Speed Two Ltd (HS2) is the Government’s huge train infrastructure project, a high speed train service directly connecting Birmingham and London. Trains would operate at speeds of up to 250mph - faster than any current operating speed in Europe - and would run as often as 14 times per hour in each direction.
The first phase of the £56bn railway is due to open in December 2026. The second phase of the project will carry on to Manchester and Leeds.
5. Youthful lifestyle city
The population of Birmingham is approximately 1,111,000 people, making this Northern Powerhouse city the largest in the West Midlands and the second largest UK city after London. The wider Birmingham Metropolitan area is home to 3.8 million people.
Birmingham is a youthful city, home to the youngest population in Europe. 45.7% of Birmingham residents are estimated to be under 30, compared to estimates of 39.4% for the UK.
Lifestyle attractions include large shopping centres, leisure and dining options, a vibrant nightlife scene, dozens of museums and galleries and plentiful open spaces and countryside.
6. University hub
Birmingham has leading 20 universities within an hour’s drive and is the UK’s second largest student city. Birmingham also makes nine in the list of the top 10 most cost-effective places to study in the UK. A large and growing university student population generates consistent tenant demand for investors.
7. Affordability, rental yield and growth
Birmingham’s average flat price was £140,973 compared to £502,705 in London (5), and around 17% lower than the national average with an average rental yield above 6%.
House prices in Birmingham are also rising much faster than in the capital, with prices up 7.7% in the year to April compared to 3.5% growth in London (6).
8. Growing demand for property investment
Global property platform Investorist has also moved its European head office to Birmingham from London, to be closer to the centre of the investor demand for UK property.
Investorist is a B2B platform which connects buyers and sellers of off plan property, with some 5000 users in 25 countries, and more than $45bn in listed property.
*Jon Ellis is founder and CEO of Investorist