The West Midlands was the best-performing region in the latest house price figures from the Office for National Statistics (ONS) and outperformed the UK overall, while London slipped back.
Average prices in Birmingham and the surrounding area went up by 4.6% in the year to November, while nationally they rose by 2.8% in the same period, a slight rise on 2.7% recorded in October. The ONS’ data, compiled from the Land Registry, puts the country’s average residential property price at £231,000. However, London was the only English region to record a fall with prices dropping by 0.7%.
Major employers including HSBC, Deutsche Bank and PWC have relocated large portions of their operations to the city, while the construction of the HS2 rail link will see high numbers of people needing a place to live in the area. Other projects such as building work for the Commonwealth Games in 2022 will also require a workforce, who will be attracted by an affordable average asking price of £197,000.
Birmingham is also Europe’s youngest city; out of the city’s current population of 1.1 million, 45.7% is estimated to be under the age of 30, including around 65,000 students across five universities and two university colleges. This means businesses (and indeed residential landlords) moving into Birmingham have access to a vast pool of qualified and ambitious graduates. Birmingham has an economy of £24.8 billion, which is recorded as the strongest outside London, and the city continues to grow as one of the strongest performing economies in the UK.
Using a strategy of targeting key areas for investment, Birmingham has developed the largest professional services hub outside of London, demanding the attention of both domestic and foreign investors that are looking to expand and take advantage of a much wider client base. As such, demand for city center living is high and house prices in Birmingham are increasing faster than any other English city.
In 2017, a study found Birmingham to be the most improved city in the UK to live and work. The city was awarded this status due to falling unemployment and a wave of investment and regeneration projects, as well as being named as having the highest standard of living of all UK regional cities.
Considering all the current and planned development activity and incoming investment, there can be no surprise that Birmingham also topped the list for house price growth in 2017, with an uplift of 7.5%on average – the highest in England and second only Edinburgh across the whole of the UK.
With average house prices across the city centre still at a relatively affordable rate of £197,461 (source: Rightmove) – £10,000 less than Manchester and more than £500,000 less than average price across the whole of London – and commercial investment showing no signs of slowing down, Birmingham still has plenty of scope for more growth.
Furthermore, the city’s continued undersupply of available homes to meet demand, Birmingham provides a highly lucrative investment opportunity for residential landlords.