Best Places to Invest in Birmingham 2021

 

Birmingham remains a key asset for investors across the world. After making huge strides in the UK market following the Brexit vote, Birmingham continues to lead the way for regional hotspots up and down the country. As the fastest growing city core in the last four years, it’s a prime example of a market built for long-term investment. But where are the best places to invest in Birmingham in 2021?

Driven largely by the ‘Big City Plan’ that started with the Bullring, a vast number of redevelopment projects are transforming large sections of the city, encouraging more and more people to move for the opportunities available. This has meant that a number of key Birmingham areas are now exceptional investment hotspots, providing an array of value depending on your chosen strategy.

With this in mind, we’re examining why you should be considering investing in Birmingham property today. These are the best places to invest in Birmingham property in 2021.

What makes these the best places to invest in Birmingham 2021?

When we talk about the ‘best’ BTL hotspots in Birmingham, we’re looking at several key investor metrics. While some of these are obvious, it’s important to get a clear idea of what makes a good Buy-to-Let investment before we jump in. Some of the examples we look for are:

 

Property Price Growth | Rental YieldsTenant DemandRegeneration | Transport Links

 

This allows us to build a complete picture of an area’s Buy-to-Let performance while also highlighting Birmingham’s performance as a whole. Here are some of Birmingham’s best property investment opportunities in 2021.

Download our 2021 Birmingham Property Guide

Looking to invest in Birmingham? Make sure you’re fully prepared with our 2021 Birmingham Investment Guide.

Filled with useful insights into the city’s new developments, rental yields, capital growth and upcoming redevelopment, it’s everything you need to know about property investment in Birmingham.

Download the Guide

Birmingham City Centre

Birmingham City Centre

 

Over the last year, Birmingham city-centre has seen massive progress across many of its main regeneration projects. Both Paradise and Arena Central draw closer to completion, while work has begun on the HS2 terminus station at Curzon Street.

Looking across the wider landscape, the Midlands Metro Expansion has made huge progress and is now operational from Grand Central to the Jewellery Quarter and beyond. It’s expected the work on the Broad Street line will complete by this time next year.

This level of redevelopment is just one contributor to Birmingham’s rising property prices. Prices have risen by 44% over the last decade but Birmingham remains relatively affordable, providing investors with a lower initial entry point and above-average rental yields.

Birmingham city-centre continues to be a bustling hub of business and as new brands move into the city-centre, they bring with them a new wave of demand from ambitious professionals in the sector.

Properties to watch in Birmingham City Centre: St Martin’s Place

Birmingham City Centre Key Stats

Average Price:

£202,162

Average Rental Yield:

5.4%

Growth since 2010:

41.67%

Jewellery Quarter

Jewellery Quarter

 

The Jewellery Quarter remains one of the top investment locations in the city-centre. Offering a ‘village feel’ without sacrificing any of the connectivity or nearby amenities, the Jewellery Quarter continues to be a hub of young professionals looking for rental accommodation. 

Property prices have risen by 28% over the last three years and properties near the Jewellery Quarter Station have seen some of the biggest rises. As a key transport link for this side of the city, it’s a major driver of demand for the area and Nationwide predicts that any properties within 500m of a station could draw a premium of 9.4%.  

With a selection of luxury-conversion and loft-style apartments, as well as plush townhouses, the stock available in the Jewellery Quarter continues to be some of the best in the city. With many more digital businesses moving into the area, expect a larger wave of demand from professionals in the city looking to live within walking distance of the office.

Jewellery Quarter Key Stats

Average Price:

£212,300

Average Rental Yield:

4%

Growth since 2010:

39.26%

Edgbaston

Edgbaston

 

Largely recognised for its sporting heritage before anything else, Edgbaston also happens to be one of Birmingham’s most affluent postcodes and a clear investment hotspot. For investors that want an investment location with established growth, Edgbaston has demonstrated nearly 40% growth over the last decade.

Property growth may not be as explosive in Edgbaston but its yields have always kept pace with its average values. Edgbaston rental prices sit at around £1,014 and while it may represent a higher initial investment, Edgbaston still maintains exceptional tenant demand and yield security. 

This is largely driven by its reputation as a family hotspot. Just ten minutes from the city-centre, Edgbaston can also offer a ‘private, village feel’ that many other areas can’t. Hosting Birmingham’s first-ever Michelin-starred restaurants, it’s also home to some of the area’s key cultural hotspots such as the Midlands Art Centre and Victorian Botanical Gardens.

Edgbaston Key Stats

Average Price:

£295,700

Average Rental Yield:

4.1%

Growth since 2010:

43.89%

Erdington

Erdington

 

Representing one of the most affordable areas in this list, Erdington is a truly emerging market for the city. Home to around 23,000 residents, plenty of amenities and easy access to the city core, it’s an ideal choice for the investor that is planning for the long-term. 

Erdington is one of the most rapidly improving locations in the city and has seen an array of investment into major facilities, including a £7.5 million leisure centre.

Transport links are particularly strong in this area and include a train station as well as connections with the M6 and Birmingham International Airport. This makes it popular with tenants that aren’t looking to live in the city-centre but still might work there or need to commute out of the area.

For offering an affordable entry point into the market and with exceptional growth on the horizon, Erdington represents one of our best places to invest in Birmingham.

Properties to watch in Erdington: Nexus Point

Erdington Key Stats

Average Price:

£173,438

Average Rental Yield:

5%

Growth since 2010:

42.90%

Harborne

Harborne

 

One of the most desirable postcodes in Birmingham, Harborne is popular with families looking for the more relaxed feel of the suburbs without compromising access to the city-centre.

Harborne is recognised as being home to a large percentage of professional workers – nearly 63% of the population work at a managerial or executive level, much higher than the UK average. This could be largely driven by the quality of the amenities available, as well as the quality of the properties on offer. 

As you’d expect, Harborne has seen some of the best property growth over the last ten years – around 30% since 2010. With some of the top performing schools in the West Midlands, as well as a fantastic retail and leisure sector, Harborne continues to be one of the best places to invest in Birmingham and one of the most affluent suburbs in the city.

Properties to watch in Harborne: CopperBox

Harborne Key Stats

Average Price:

£362,574

Average Rental Yield:

4.6%

Growth since 2010:

39%

Digbeth

Digbeth

 

Digbeth is widely recognised as Birmingham’s most ‘up-and-coming’ area. Just five minutes from the Bullring and the city-centre, Digbeth is a vibrant melting pot of arts, culture, digital business and exciting independent retail – making it one of the key winners in the best places to invest in Birmingham. 

Home to many of the city’s leading art, digital and media companies, as well as hosting Birmingham Coach Station and the future HS2 interchange hub at Curzon Street, Digbeth is establishing itself as a thriving area for young professionals to work and live. With strong transport connections, it’ll receive a huge boost in foot traffic when both the HS2 and Birmingham Smithfield projects complete. 

In terms of past performance, Digbeth has seen property price growth of 401% in the last 20 years and according to JLL, it’ll experience 16.5% over the next four years. This demonstrates the potential that the area holds, driven by the regeneration that is transforming the local skyline.

Properties to watch in Digbeth: Fabrick Square

Digbeth Key Stats

Average Price:

£189,400

Average Rental Yield:

4.7%

Growth since 2010:

43.28%

Best Capital Growth Areas in Birmingham

If you’re looking to identify capital growth in Birmingham, look no further than Digbeth and Edgbaston. Both of these areas have experienced the best growth over the last ten years but offer very different propositions for investors.

 

Digbeth

 

Digbeth can be considered an emerging market and is much more affordable than Edgbaston – the average price in Digbeth is £186,276 vs £299,067 in Edgbaston. Regeneration in the area is helping drive its growth and ensuring that in the long-term, it’ll be a desirable hotspot for both investors and residents. Right now, Digbeth represents an affordable entry point into a wider Birmingham property market that is forecasting incredible growth and even higher demand. 

Edgbaston, on the other hand, is an investment area further along the ‘growth cycle’. While it’s a more expensive initial proposition, it has a proven level of growth that is driven by a strong local workforce and incredible resident amenities nearby. That said, Edgbaston is a much more ‘suburban’ area and is mainly populated with houses rather than the apartments that are typically more popular with investors. Similarly, it’s further from the city-centre than Digbeth, which may be a factor for tenants seeking a certain lifestyle.

Read our 2021 UK Market Forecast

Want to know more about the UK property market? Our 2021 UK Property Forecast has everything you need to make your next investment an informed one.

With the latest rental yield and capital growth predictions, as well as headlines from the top PLC’s across the country, it’s ideal if you’re looking to learn more about a market that is experiencing unprecedented demand.

Read our 2021 Forecast

Best Rental Yield Areas in Birmingham

Rental yields in Birmingham are generally above-average. With an average yield of 5.1%, the city is recognised as one of the more potentially lucrative markets in the UK – affordable enough to attract new investment while still offering exceptional returns.

 

Digbeth

 

Digging deeper into individual areas, it’s no surprise that the same holds true for the more affordable markets in the city. Both Digbeth and Erdington top the list for affordability in Birmingham and are still in demand because of the lifestyle and amenities they can provide. 

This invariably leads to better rental yields: Digbeth at 4.7% and Erdington at 5%.

For investors interested in a long-term strategy, these are the areas that should be primarily considered. While they represent affordable entry points now, future redevelopment will contribute to rising demand which in turn supports rising rental prices and yields, making them key considerations for the best places to invest in Birmingham.

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