Top 5 Suburbs for Birmingham Property Investment

Birmingham has long been at the top of property investor’s list of cities to purchase buy to let property in, and with good reason. As the UK’s second city with a population of over 1.1 million and an enviable pipeline of investment, Birmingham is an investor’s dream. However, this West Midlands city is broad in scope and covers a variety of individual regions – so, which one is best? We’ve pinpointed five suburbs for Birmingham property investment to help you find the areas with the best yields, the biggest tenant demand and the strongest regeneration.

Selly Oak

As Birmingham’s best known hub for students at the University of Birmingham and Birmingham City University, Selly Oak is a fantastic hotspot for student investment and HMO’s. Although Selly Oak is renowned for being a predominantly student-occupied region of Birmingham, it is also a popular suburb for those commuting to the Queen Elizabeth Hospital or the city centre for work. This is especially true considering that trains between Selly Oak and New Street take just 10 minutes, and trains from Selly Oak to University for the Queen Elizabeth Hospital take just two minutes. This ensures that demand for Selly Oak property remains high for years to come, making this a sensible suburb for Birmingham property investment. 

According to PropertyData, the B29 postcode in which Selly Oak lies has a 9.7% average rental yield and average property price of £274,000, which puts property prices in this region marginally below the national average of £284,691 and yields far above average. As anticipated, yields in Selly Oak are highest for 5+ bedroom homes for their HMO potential, with these units generating yields of consistently above 6%. For those looking to purchase an HMO, you can expect to make an average of £605 each month on a single en-suite room and £439 on average for a single room with a shared bathroom. So, for investors keen on delving into the student property market or sourcing shared properties for young properties, Selly Oak is a fantastic place to start.

Digbeth

As one of Birmingham’s most up-and-coming suburbs, it should come as no surprise that Digbeth has made our list of the top 5 suburbs for Birmingham property investment. An abundance of investment schemes and redevelopment opportunities have begun in Digbeth, most notably the construction of the upcoming Curzon Street HS2 station which will make Digbeth the epicentre of West Midlands high-speed travel. And it’s not just HS2 which is transforming Digbeth: this new so-called ‘creative quarter’ of Birmingham is soon becoming home to the BBC Headquarters, a new Camp Hill Railway line and over 2 million sq ft of commercial space over the next 15 years. As a result, yields in Digbeth are exceptionally high as investors and home-movers vye to take advantage of this up-and-coming area. 

In fact, according to PropertyData, the B5 postcode in which Digbeth lies commands a 7.5% rental yield and properties cost an average of £196,000 – this makes Digbeth an affordable region to invest in that still presents enviable yields for investors. However, it is important to note that the vast majority of properties in Digbeth are apartments and studios tailored towards working professional couples and singles, such as Digbeth One 2: if you are looking to purchase a house as opposed to a flat, Digbeth may not be suitable.

Longbridge

If you’re looking to invest in a suburb just outside of Birmingham that is experiencing an ambitious pipeline of redevelopment, look no further than Longbridge. Situated 8 miles away from Birmingham city centre, Longbridge benefits from having its own community and identity whilst simultaneously having excellent access to all of the amenities Birmingham has to offer. Better yet, this suburb has recently acquired £24 million in investment funding on top of its involvement in Birmingham’s broader Our Future City Plan, with Longbridge set to see an influx of jobs and therefore property demand in the coming years.

Growth in Longbridge property prices is particularly impressive: in February 2019, the average property cost £172,850, which soared to £216,079 in February 2023, which is a 25% increase in just four years. This isn’t to mention that property prices in Longbridge are very competitive, making these units appealing to both investors and buyers. One bedroom properties will set you back £138,000, two bedrooms will cost you £212,000, and a three bedroom unit will cost an average of £236,000. 

This is far less than the price of an average Birmingham city core property – using a search radius that covers core regions such as Aston, Balsall Heath, Edgbaston and the City Centre, we have calculated that the average central Birmingham one bedroom property costs £165,000, two bedrooms cost £248,000, and three bedrooms cost £307,000. This showcases just how lucrative property investment in Longbridge is in comparison.

Solihull

Just a short 8-minute train journey from Birmingham is Solihull, our next area of focus. This West Midlands town is has its own abundance of amenities, transport connections and career opportunities, as well as the benefit of such close proximity to Birmingham, which makes it a fantastic place to invest in. 

Most notably, Solihull is home to Birmingham International Airport, which makes it an ideal location for investors looking to cater to working professionals that require air travel as part of their regular schedule. Generally, these individuals and families have a higher household income, which is reflected in the house prices of properties in this area. Properties in Solihull will set purchasers back £364,000 on average according to Rightmove.

However, despite the marginally higher cost of properties in this area, yields remain high – a one bedroom property comes with an average yield of 6.6%, and two bedroom units have an average yield of 5.5% according to PropertyData.

Jewellery Quarter

As one of Birmingham’s most historic and iconic suburbs, the Jewellery Quarter is an absolute must-see for those looking. for Birmingham property investment opportunities. This neighborhood offers everything a tenant could possibly want – from transport links directly into the city centre, swanky bars and restaurants, a growing abundance of job opportunities, as well as stylish living spaces in developments such as the Scholar’s Quarter, The Copperworks and The Pressworks. The region is also in the midst of extensive regeneration, with the Birmingham Future City Plan outlining the prospective reconstruction of the Hockley Flyover, as well as the redevelopment of Central West to create more bustling commercial spaces. This will make the Jewellery Quarter more accessible than ever, and full of opportunities for new and established businesses which will increase tenant demand significantly. 

Properties in this suburb do come at a little more of a premium, with one bedroom properties costing an average of £168,000 and two bedroom properties sitting at £264,000, which is higher than the average Birmingham city core property. However, this price is certainly worthwhile, with Jewellery Quarter rents being much higher than average: for those with a one bedroom property, your rent will likely be charged at an average of £943, with this rising to £1,227 for two bedroom properties. Considering this, it is no surprise that properties in the Jewellery Quarter can achieve yields of up to 6.4% according to PropertyData. 

Whether you’re searching for a property that oozes character in the Jewellery Quarter, a commuter haven in Digbeth or a student HMO in Selly Oak, Birmingham has it all. If you’re looking for advice on your next property investment, or simply want to discuss your options, contact our Investment team below: