In recent times, Birmingham has widely been considered as one of the very best places to invest in, throughout the whole of Europe. In 2016, Birmingham was voted as the sixth best city for investment prospects in Europe in the PwC and Urban Land Institute ‘Emerging Trends in Real Estate’ report. The investment potential in Birmingham was even further highlighted by the fact that London wasn’t even featured in the top 10 of this report.
Recent years have cemented Birmingham as one of the most talked about UK cities in relation to property investment, and now may just be the perfect time to invest in property within the city.
The Development of Birmingham
Birmingham as a city has experienced significant investment recently, with billions of pounds having been pumped into the city in order to redevelop it and help it become a more attractive destination for people to live, work and invest. There has been increased commercial interest in the city as a result of the big redevelopment investment, providing a place for businesses to be based, attracting a wave of professionals and skilled workers into the area.
This has been further supported by the HS2 rail network, of which is set to be introduced to Birmingham, providing a fantastic connection from London to Birmingham, Leeds and Manchester, of which opens up vast opportunities. As a result of this, more neighbourhoods are set to be created and a number of residential and retail areas are to be developed. With the regeneration that the city is experiencing, the city of Birmingham is truly developing into a place that is desirable to both people looking to live and people looking to work in the area.
Birmingham-based property developers are also falling over each other to become part of the development of a newly formed Birmingham. Luxury housing is being built throughout the Birmingham area, attracting professionals and wealthier individuals to the city, helping to economically develop the area as a whole.
Birmingham as an investment opportunity
As with any investment opportunity, investment property in Birmingham does have its associated risks, but the city provides great potential for investing. By conducting the right research, making use of the right guidance and taking your time with the investment, you may well be able to secure yourself a fantastic property investment.
Many investors looking to diversify their property portfolio are shifting their focus from London to Birmingham, looking to take advantage of the area, but also the fantastic potential that property investment within the city has to offer.
Low supply of properties and extremely high property prices are driving buy-to-let investors out of the city, and Birmingham is welcoming them with open arms.
An increase to the popularity of Birmingham amongst investors has helped investors to see their yields grow by nearly a quarter over the last 12 months. Price growth within 2015/16 was found to be 5.3%, with an estimated capital gains growth of 17% predicted for the period between 2015 and 2019.
As is a well known fact, cities within the north of England have developed over recent years and have become an investment hotspot for landlords, particularly as popular areas for students to live and to study. Birmingham can very well be put into that same category, with more than 75,000 students needing affordable accommodation.
This opens up a whole world of opportunities for investors, allowing them to get into the profitable Birmingham student accommodation market, as well as proving that Birmingham as a city is a very popular one that should certainly be considered as a next investment location.
Mark Burns is the Managing Director of property investment firm, Hopwood House.