A recent surge in activity in the city’s rental property market has led to Birmingham being named the UK’s premier buy-to-let hotspot outside London. According to data from the Council of Mortgage Lenders (CML), Birmingham comes second only to the Capital in terms of recent buy-to-let property purchases.
Last year, Birmingham only took seventh place on the list. It is believed that the leap into second place is at least partly down to an increase in demand for rental properties brought about by the new HS2 line providing high-speed rail travel to and from London. The surge in Birmingham’s buy-to-let activity also takes place against a backdrop of general growth in the UK’s buy-to-let market, with activity nationwide showing year-on-year growth of over a fifth. This continues a trend of increasing interest in buy-to-let properties over the past few years, driven by poor returns on savings accounts encouraging more people to look at alternative ways to grow their money.
Over the first six months of this year, Birmingham’s rents averaged £766. This compares favourably to other cities that represent notable buy-to-let markets such as Nottingham (£639), Manchester (£693) and Leeds(£703). It is, however, considerably lower than London’s average of £1,900 over the same period.
London took the top spot on the list of buy-to-let hotspots, and areas within the capital’s commuter belt are also doing very well. Landlords are increasingly looking for better value in locations outside of London but within sufficiently easy reach to benefit from the demand that the capital generates.