How Birmingham’s Growing Young Population Will Impact the Rental Market
Birmingham has a broad range of advantages as a Buy-to-Let market and yet one major factor that is often overlooked is the average age of its population.
Birmingham’s ‘renting population’ in particular continues to be incredibly young, with nearly 60% of the rental market under 35. From graduates staying in the city to workers relocating for incredible career opportunities, there’s no doubt that Birmingham has a lot to offer the modern young professional.
This matches up with recent research suggesting that young professionals (typically aged 25 to 34) still make up a broad percentage of the private rented sector in the UK. There’s no doubt that younger people are more inclined to rent – home ownership still remains incredibly expensive for the majority of people and the flexibility that renting can offer remains a huge benefit.
For investors then, this demographic only serves to highlight Birmingham’s potential as a Buy-to-Let market – as a young tenant base more likely to rent flocks to a city that can offer relative affordability without compromising on the excellent amenities or employment opportunities.
While Birmingham remains a key destination for many workers looking to relocate, it’s also avoiding the ‘brain drain’ of losing key graduate workers.
The second city is the largest centre of higher education outside of London in the UK and is home to some of the best universities in the country. From Aston University to Birmingham City University (BCU) and Birmingham University (UoB), Birmingham supports over 100,000 students across all of its institutions, a huge demographic attracted by the lifestyle and quality of learning.
Fortunately, it seems Birmingham is doing enough to encourage these graduates to stay – 40% of final year students currently studying in the city stay after they graduate. At the same time, according to Centre for Cities, Birmingham is the third best city in the UK for attracting graduates with no prior links to the city, further boosting a talented workforce.
This will play a huge part in Birmingham’s incredible population growth, which continues to put pressure on residential supply in the city. For investors, it’s a clear signpost that demand is present in the city and it’s being driven by one of the demographics most likely to rent in the country.
Similarly, past performance shows that universities and other education centres play a huge role in the property prices of a location. In the past three years – the typical time it would take to complete a degree – property prices in 65 university towns have risen by an average 22%.
As developments continue to complete that will serve to attract even more professionals and graduates alike, now is the time to take advantage of a competitive and potentially lucrative market.