Authored by the expert who managed and guided the team behind the United Kingdom Property Pack
Yes, the analysis of Birmingham's property market is included in our pack
What will happen in Birmingham’s real estate market? Will prices go up or down? Is Birmingham still a hotspot for property investors? How is the UK government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with local estate agents, property developers, and clients who buy properties in Birmingham, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
1) Rental yields in Selly Oak will stay strong because of steady demand from students
Rental yields in Selly Oak are expected to stay strong in 2025 thanks to a steady stream of students.
With over 38,000 students enrolled at the University of Birmingham in 2024, Selly Oak is buzzing with demand for rental properties. This large student population is a key driver for the area's rental market, making it a hotspot for property investors.
Historically, Selly Oak has been a goldmine for landlords, with the B29 postcode offering an average yield of 7.00%. This makes it one of the most appealing areas for student property investment in the UK, thanks to its consistent rental returns.
Low vacancy rates are another reason why rental yields remain high. Even though there's a shortage of Purpose-Built Student Accommodation (PBSA), Selly Oak rarely sees empty properties. This scarcity keeps rental prices up, ensuring landlords enjoy solid returns.
Adding to the mix is a deficit of 12,000 beds in student accommodation across Birmingham. This shortfall pushes rental prices higher, keeping yields strong in student-centric areas like Selly Oak.
Sources: Statista, The Complete University Guide, Track Capital
2) Birmingham’s property prices will keep rising due to continuous urban development and investment
In recent years, Birmingham has seen a significant rise in property prices, with a 66% increase over the last decade. By 2024, the average property price reached £228,663. This trend is expected to continue, with forecasts predicting a 3.7% annual increase from 2024 to 2028, culminating in a total growth of 19.9% by 2028.
The ongoing construction of the HS2 high-speed rail is a major factor contributing to this upward trend. This project is set to improve connectivity, making Birmingham more attractive to professionals and increasing the demand for housing. Additionally, the Birmingham Smithfield Development, a £1.5 billion regeneration project, is transforming a former industrial area into a vibrant city center neighborhood. This development is drawing significant investment and is expected to yield high returns for property investors.
Birmingham's population is projected to grow to 1.24 million by 2030, driving demand for housing. The city faces a housing shortage, with annual housing delivery falling short of the 7,000 new homes needed each year. This undersupply keeps property prices competitive. Furthermore, the city is attracting international investors, particularly due to its massive regeneration projects, which promise substantial growth and development potential.
Sources: Joseph Mews, Gladfish, Birmingham Homebuyer Group
We have made this infographic to give you a quick and clear snapshot of the property market in the UK. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Rents in Birmingham will rise as more young professionals and students move to the city
Rents in Birmingham are climbing as the city becomes a magnet for young professionals and students.
In 2023, the average rent in Birmingham jumped by 5.5%, hitting £990 per month. This increase shows just how strong the demand for rental properties is, with a competitive rental yield of 5.21%. The city is buzzing with opportunities, and people are eager to be part of it.
Young professionals are flocking to Birmingham, making up a significant chunk of the rental market. By 2024, about 43% of the city's population was aged 20–35, and they accounted for 60% of the rental market. They're drawn by Birmingham's lower living costs compared to London and the growing job market, with big names like Goldman Sachs and HSBC setting up shop here.
Birmingham's student population, over 80,000 strong, is another key player in the rental scene. The University of Birmingham and other educational institutions keep the demand for rental properties high. But there's a catch: the city is facing a housing shortage, with new housing falling short of the 7,000 homes needed annually to meet demand.
With more young people and students moving in, Birmingham's rental market is only getting hotter. The city's vibrant lifestyle and job opportunities are hard to resist, making it a top choice for those looking to rent. As the city continues to grow, the demand for rental properties is expected to keep rising.
Sources: Joseph Mews, Track Capital, Birmingham Homebuyer Group
4) Demand for accessible housing in Birmingham will grow as the population ages
Birmingham's population is getting older, and this shift is shaping the housing market.
By 2040, the city will see a 29% increase in residents aged 65 and over, meaning more than 194,000 older adults will call Birmingham home. This surge in the elderly population is driving a need for homes that cater to their specific requirements.
With people living longer in the UK, there's a growing demand for single-story homes or those with accessible features. As mobility issues become more common with age, these types of homes are becoming increasingly popular among older adults.
Birmingham City Council is on top of this trend. Their reports emphasize the need for affordable and accessible housing to support the aging population. The council's efforts focus on helping residents live longer, healthier, and more independent lives.
These initiatives often mean designing homes with accessibility in mind, ensuring that older adults can stay in their homes comfortably as they age. The council's Housing and Economic Development Needs Assessment is a key part of this strategy.
As Birmingham's population continues to age, the demand for age-friendly housing options will only grow. This shift presents a unique opportunity for those looking to invest in the property market.
Sources: Birmingham City Council, Birmingham Housing and Economic Development Needs Assessment, Market Position Statement - May 2023
5) Property demand and prices will rise in Digbeth as it becomes popular with creative professionals
Digbeth is becoming a hotspot for creative professionals, and this is driving up property demand and prices. One of the main reasons is the rising property prices in Birmingham, which have shown consistent growth over the past decade. In 2024, the average property price was £228,663, and it's expected to increase by 3.7% in 2025 and 19.9% by 2028.
The area is also seeing an increasing number of creative businesses and startups. Digbeth has become the center of a thriving tech scene, with companies like Holosphere and Katje’s Magic Candy Factory setting up shop there. This shows the abundance of talent and resources available, making it an attractive place for creative professionals.
Local government investment in infrastructure and cultural projects is another key factor. The BBC's new broadcast center is set to open in Digbeth in 2026, and MasterChef moved there in 2024. These significant investments are boosting the creative industry in the area, making it even more appealing.
Media coverage has also played a role in highlighting Digbeth as an emerging creative hub. Articles have reported on its potential as a center for film, media, and tech, contributing to its growing appeal among creative professionals.
Development of new residential and commercial properties is part of a larger regeneration project aimed at enhancing the area's appeal. This includes transforming historic buildings into modern creative spaces, attracting more businesses and residents.
Digbeth's proximity to Birmingham city center and excellent transport links make it an attractive location for both residents and businesses. It's within a 10-minute walk from Grand Central, making it easily accessible for clients and visitors.
The growth in creative industry employment in Birmingham is driving up demand for housing and commercial spaces. This economic expansion is expected to continue, further boosting property prices in Digbeth.
Sources: Meet Birmingham, Birmingham Homebuyer Group, Birmingham Biz, City REDI Blog
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6) Property values in Selly Oak will rise as student housing demand grows with the expanding university population
Selly Oak is buzzing with property investment opportunities thanks to the rising demand for student housing.
The University of Birmingham is expanding, with 38,820 students enrolled in the 2022/23 academic year, and this growth is spilling over into Selly Oak. As more students flock to the area, the need for housing skyrockets, making Selly Oak a prime spot for property investors.
A major highlight is the new 836-bed purpose-built student accommodation (PBSA) project, which includes 472 studios and 364 cluster flats. This development isn't just about housing; it also features commercial and medical facilities, showing a clear student preference for Selly Oak living.
Birmingham City Council's backing of these projects is a game-changer. Their approval of the PBSA development signals to investors that Selly Oak is ripe for property investment. This support streamlines new housing construction and boosts investor confidence.
Media outlets are buzzing about Selly Oak as a student housing hotspot, which only adds to its allure. This coverage not only attracts students but also draws in investors eager to capitalize on the area's potential.
With the local government's support and the university's expansion, Selly Oak is set to see a rise in property values. Investors are taking note, and the area's transformation is well underway.
Sources: Statista, Galliard Homes
7) Property values in Kings Heath will rise as it becomes popular with young professionals
Kings Heath is quickly becoming a favorite spot for young professionals, and this is set to boost property values.
Thanks to the new Camp Hill line, getting to the city center is now faster and easier, making Kings Heath a great choice for city workers who want a suburban lifestyle. The improved transport links are a game-changer for daily commuters.
There's been a noticeable increase in new developments and renovations, especially on Vicarage Road, where luxurious homes are popping up. These modern, high-quality homes are exactly what young professionals are looking for, and they're willing to pay a premium for them.
The high street is buzzing with trendy cafes, bars, and restaurants, creating a lively vibe that young professionals love. This vibrant atmosphere is a big draw, making the area even more appealing and pushing property prices up.
Local government initiatives like the Places for People scheme are making the area safer and more pedestrian-friendly, which aligns perfectly with the lifestyle young professionals want. These efforts are transforming Kings Heath into a sought-after neighborhood.
With all these factors, plus the buzz from media and social media, Kings Heath is on the rise. It's becoming a trendy area that attracts more young professionals, which in turn drives up property values.
Sources: WMRE, MIA Property Group, Rightmove
8) More foreign investors will enter Birmingham’s residential market because of favorable exchange rates
The number of foreign investors in Birmingham's residential market is likely to keep increasing due to favorable exchange rates. In the past, specifically around 2023 and 2024, the depreciation of the pound significantly boosted the purchasing power of foreign investors. For instance, American buyers enjoyed an 18% price discount in the UK property market compared to 2016, making it an attractive proposition.
Moreover, the UK property market, particularly in luxury segments, has become increasingly appealing to international buyers. By 2024, overseas buyers were responsible for nearly 50% of all transactions in London's super-prime market, up from 36% in 2023. This trend highlights the impact of favorable currency exchange rates, making UK properties more affordable and enticing for foreign investors.
Additionally, real estate agents have reported a rise in foreign inquiries, driven by these favorable exchange rates and the overall attractiveness of the UK property market. This trend is expected to continue as more international buyers seek to capitalize on the current market conditions.
Sources: Magnate Assets, Joseph Mews
We made this infographic to show you how property prices in the UK compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Demand for rentals near universities will grow as the student population increases
The growing student population in Birmingham is a key factor driving the demand for rental properties near universities. In the past, during the 2022/23 academic year, Birmingham's universities had a significant number of students, with the University of Birmingham alone hosting nearly 39,000 students. This large student body contributes to the overall demand for housing in the area.
Additionally, the increasing number of international students has further fueled this demand. The development of luxury student accommodations, such as those financed by Atelier, indicates a strong interest from international students who often seek high-quality living spaces. This trend suggests that more students are looking for rental properties that offer comfort and modern amenities.
Moreover, the supply of purpose-built student accommodations (PBSA) is on the rise, with thousands of new bed spaces under construction or planned. This growth is a response to the projected demand for student accommodations, which is expected to reach up to 47,640 spaces by the 2025/26 academic year. The local government's reports also highlight this increasing demand, emphasizing the need for more rental properties to accommodate the growing student population.
Sources: Statista, Building Brum, Birmingham City Council
10) Rents will rise in lower-income areas as gentrification takes place
Gentrification often leads to increased rents in traditionally lower-income areas due to several interconnected factors. One of the primary reasons is the rising property prices. In Birmingham, for instance, the city has experienced significant population growth, which has driven up property prices in these areas. This trend was highlighted in the Birmingham Housing and Economic Development Needs Assessment, which noted a 16% population increase since 2001, leading to higher property values.
Another contributing factor is the increased investment in local infrastructure and amenities. The Birmingham Crane Survey 2024 reported that areas like the Jewellery Quarter have seen substantial investment, resulting in improved amenities and infrastructure. Such enhancements make these neighborhoods more attractive to higher-income residents, thereby driving up rents. Additionally, media coverage often highlights these neighborhood transformations, further increasing their appeal and desirability.
Demographic shifts also play a crucial role. Birmingham's population is younger compared to the wider region, attracting higher-income families and professionals. This demographic change increases the demand for housing, leading to higher rents. The presence of universities in the city center also attracts talent, contributing to the influx of higher-income residents.
Sources: Deloitte, BD Online, Birmingham City Council
11) Foreign buyers will increasingly seek larger homes in Birmingham's suburbs
Birmingham's real estate market is shifting as more buyers look beyond the city center.
With rising property prices in central Birmingham, many are eyeing the suburbs for better deals. It's not just about saving money; people want larger living spaces, especially with remote work becoming the norm.
Foreign buyers are particularly interested in spacious homes with gardens for their families. Suburban areas like Edgbaston are gaining popularity because they offer exactly that. Plus, with the development of HS2, commuting is becoming easier, making these areas even more appealing.
Another draw for international buyers is the growing number of international schools and amenities in the suburbs. These are crucial for families who value education and community facilities.
All these factors make Birmingham's suburbs a top choice for those wanting a mix of city access and a peaceful, roomy living space.
Foreign buyers will likely continue to show more interest in Birmingham's suburban areas as they seek larger properties.
Sources: Birmingham Homebuyer Group, CBRE
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12) Flood prevention efforts will boost buyer interest in some Birmingham neighborhoods
Flood prevention initiatives are making certain Birmingham neighborhoods more attractive to buyers.
In areas like Perry Barr and Witton, the Environment Agency has invested £50 million in flood risk mitigation, leading to the construction of a new flood storage reservoir. This reservoir can hold 1.7 million cubic meters of water, which significantly reduces the risk of flooding in these neighborhoods.
These improved flood defenses, including flood walls and gates, have already proven their worth. For example, they successfully prevented flooding in Witton during May 2018 and February 2020. This track record gives potential buyers confidence that their properties will be protected from future flood events.
As these flood prevention projects wrap up, property values in these areas are on the rise. This trend indicates that buyers are willing to pay more for homes in flood-protected zones, viewing them as a safer investment. Additionally, properties in these areas often enjoy reduced insurance premiums, making them even more appealing to potential buyers.
Sources: Public Sector Executive, GOV.UK
13) Fewer European buyers will invest in Birmingham due to post-Brexit regulations
Birmingham is seeing fewer European buyers in its property market, thanks to post-Brexit changes.
Since June 2023, new rules have made it tougher and pricier for EU citizens to buy property in the UK. These changes have added layers of complexity to the buying process, discouraging many potential buyers from even considering the move.
There's also been a noticeable drop in EU nationals moving to the UK. The EU Settlement Scheme shows more EU citizens being turned away at the UK border, hinting at a broader trend of waning interest in relocating here. Fewer people moving means fewer potential buyers looking for homes.
High interest rates and Brexit uncertainties are making the UK less appealing to European investors. Media reports highlight the struggles EU buyers face, like getting mortgages and dealing with higher transaction costs, which only adds to the hesitation.
These challenges are not just about buying a home; they reflect a shift in the overall market sentiment. The once vibrant interest from European investors is cooling off, as the hurdles seem to outweigh the benefits.
For those considering a property purchase in Birmingham, it's crucial to understand these dynamics. The landscape is changing, and knowing the current market conditions can help in making informed decisions.
Sources: Thompson Removals, Snow Only, The 3 Million
14) City center yields will drop slightly as property prices rise faster than rents
In recent years, Birmingham's city center has experienced a significant rise in property prices. This trend has been particularly noticeable since 2023, with property prices increasing by 66% over the last decade. As we moved through 2024, Birmingham was recognized as the fastest-growing city in the UK for property prices, a trend expected to continue through 2028.
However, rental prices have not kept pace with this rapid increase in property values. For example, while the average monthly rent in Birmingham rose by 8.7% from November 2023 to November 2024, this growth is still slower compared to the surge in property prices. This disparity is evident in the rental market for different property sizes, where one-bedroom rents increased by 9.3%, and larger properties saw a 6.9% rise.
Historically, Birmingham's rental yields have been competitive, but the gap between property price growth and rental growth suggests a potential decline in yields. Although the average rental yield increased slightly from 5.17% in 2023 to 5.21%, the ongoing trend of property prices outpacing rental growth indicates that yields might decline slightly in the future.
Sources: Joseph Mews, ONS
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of the UK. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Property prices on Birmingham's outskirts will drop moderately as demand moves to the city center
In recent years, Birmingham's city center has become a hotspot for property transactions, with house prices expected to rise significantly between 2023 and 2027. This growth is largely concentrated in the city center, indicating a shift in demand towards urban living.
The Grand Central Transformation project has played a crucial role in this shift by creating modern office spaces, retail, and leisure units. This development has not only boosted the local economy but also attracted young professionals, further increasing the demand for city center properties.
Moreover, Birmingham is known as the youngest city in Europe, with a large portion of its population under 30. This younger demographic tends to prefer urban living, which has driven up demand for properties in the city center. Additionally, improved public transportation, like the Birmingham Xpress bus rapid transit system, has made commuting easier, making city center living more appealing.
Sources: CityRise, Birmingham City Council
16) Demand for modern apartments in Birmingham will grow as more young professionals move in
Birmingham is becoming a hotspot for young professionals, and this is set to boost the demand for modern apartments.
With the city's tech and finance sectors booming, over 6,000 tech firms now employ 38,000 people as of 2023. This growth is a magnet for young talent, drawing them to Birmingham's vibrant job market.
The number of 20-35-year-olds in Birmingham has seen a 1.3% increase since 2021. This age group is flocking to the city, attracted by its urban lifestyle and cultural perks, which naturally ramps up the need for modern living spaces in the heart of the city.
New business hubs and coworking spaces are popping up, thanks to initiatives like Silicon Canal. These developments make Birmingham even more appealing to tech-savvy professionals, further fueling the demand for contemporary apartments.
Rental prices for these sought-after apartments are climbing, a clear sign of the growing demand. Young professionals are willing to pay a premium for the convenience and lifestyle that city-center living offers.
Sources: Shepcom, Birmingham City Council, Centre for Social Justice
17) City center property price growth will slow as more people choose to live in the suburbs
In recent years, we've seen a noticeable trend where more people are choosing to live in the suburbs rather than the city center. This shift is largely due to the development of new amenities and infrastructure in suburban areas, which has made these locations more attractive to potential residents. For example, areas like Digbeth and the Jewellery Quarter have experienced a surge in property sales and investments, indicating a growing interest in suburban living.
Another significant factor is the increased demand for larger homes with gardens, a preference that has become more pronounced following the pandemic. People are now looking for more space and less densely populated areas, which suburban regions can offer. This change in lifestyle preferences could lead to a stabilization or even a decline in rental prices in the city center, as more people move to the suburbs.
Additionally, the rise of remote work has given professionals the flexibility to live further from their workplaces. Consumer surveys have shown that many people appreciate the benefits of suburban living, such as more space and a quieter environment. Improved transportation links, like the Birmingham Xpress bus route, have also made commuting from the suburbs to the city center more convenient, further encouraging this shift.
Sources: Joseph Mews, Flambard Williams, Capital B News
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.