Birmingham City Guide Key Essentials 2018 surrendeninvest the home of your portfolio
01. Welcome to Birmingham Birmingham is one of the UK s most important cities. It is a thriving metropolis that is home to more than 1.1 million people, meaning it is eclipsed in size only by London. Birmingham is often referred to as Britain s second city both as a result of its size and due to its economic and strategic importance. EDINBURGH GLASGOW NEWCASTLE BELFAST LEEDS MANCHESTER LIVERPOOL BIRMINGHAM CARDIFF BRISTOL LONDON
Birmingham is home to one of the UK s most exciting urban landscapes. Historic buildings such as the Council House and Curzon Street station rub shoulders with outstanding examples of contemporary architecture. Selfridges at the Bullring is one of the most iconic, with 15,000 spun aluminium disks giving the building an unrivalled, futuristic appearance. The Library of Birmingham, the Cube and the Spiral Café also demonstrate the best of Britain s modern architecture. 5 universities & 4 major colleges support 65,000 students. Working population of 4.3 million people As well as its unique cityscape, Birmingham offers a vibrant, youthful culture. With five universities in the city, and a further 20 within an hour of Greater Birmingham, the city is home to the second largest population of students in the UK. With 65,000 students calling Birmingham home, the city is well geared up to entertaining them when they re not studying, and is known for having one of the best shopping and nightlife scenes in the country. Cultural pursuits also abound. Theatres, museums, galleries, heritage centres, botanical gardens, the Birmingham Royal Ballet and plenty more awaits those looking to enjoy the more refined side of life in the city. In fact, Birmingham s attractions are so numerous that the city attracted record visitor numbers in 2016, with 39 million visitors generating tourism revenue of 6.5 billion. The impact of Birmingham s many wonderful attractions continues to bring wealth and growth to the region. Cllr Ian Ward, Deputy Leader of Birmingham City Council Birmingham s youthful population and the huge number of graduates that the city produces every year has created an excellent environment for entrepreneurship. According to Startups, Birmingham has more new start-ups and active businesses than any city other than London. Creative businesses, digital agencies and tech startups are focused around Silicon Canal, which is home to some 210 tech companies. Overall, Birmingham is home to a staggering 6,000 tech firms, employing 38,300 people. Business startups in the city were up by 37% in 2016, according to the October 2017 Birmingham Economic Update, reaching a level of 65.8 per 10,000 residents
A reputation as a city of economic opportunity has led Birmingham s population to boom. Between 1981 and 1990, Birmingham s population reduced by 3%. Between 1991 and 2000, it fell by a further 2%, based on figures from the Office for National Statistics. However, between 2001 and 2013, Birmingham s population increased by 11%. If recent trends continue, the population is expected to increase by 8.0% in the decade to 2024 and by 15.1% by 2034. 1981-1990 1991-2000 2001-2013 2014-2024 2025-2034 35.0% 30.0% 27.5% 25.0% 22.5% 20.0% 17.5% 15.0% 12.5% 10.0% 7.5% 5.0% 2.5% 0% -2.5% -5.0% -7.5% The rapid rate of growth has created some unique challenges for Birmingham, particularly in relation to its housing, as well as some unique opportunities.
02. The race to house Birmingham s growing population Birmingham, like many cities in the UK, has enjoyed rapid population growth in recent years, which has put pressure on its housing resources. In addition, the city s population is expected to boom by a further 150,000 over the next 16 years, deepening the problem of housing supply not being able to keep up with demand. Clearly, Birmingham can t meet its housing requirement and as a consequence we are going to have to work together closely, moving forward. Waheed Nazir, (then) Director of Planning and Regeneration, Birmingham City Council Council figures project that some 80,000 new homes are needed in Birmingham by 2031. However, the National Housing Federation reports that construction in the West Midlands has fallen short of requirements to the tune of 45,000 homes in the last five years. Within Birmingham, the deficit of homes over that time period stands at 18,000 units. The shortage is in part due to the shifting tenancy status of UK residents, with levels of property ownership dropping over a number of years. In the West Midlands, 70.5% of the population owned their own home in 2005, compared with just 59.3% today, according to the Resolution Foundation. As ownership has dropped, the proportion of households renting privately across the region has grown from 8% to 17%.
Within Birmingham, the shortage has been further exacerbated by government policy in recent years. The extension of the right to buy scheme to include housing association tenants has, according to Shelter, created a situation whereby Birmingham will be forced to sell 1,190 council houses every year. Housing association tenants are able to buy their homes at up to 70% off market value (based on how long they ve lived there). Housing associations then build new homes, funded partly through the sales and partly by the local council, with the council s share coming from the sale of its most expensive council houses. Shelter has concluded that, in Birmingham, 144 million will be raised annually through the sale of 1,190 council properties. The situation also means that the supply of accommodation for Council tenants in Birmingham is dwindling, even as population growth and demographic shifts are placing additional pressure on the private rented sector. Those who can purchase accommodation are faring well as a result of the housing shortage. According to Zoopla (as at December 2017), Birmingham property values have risen by 3.64% over the past 12 months, and by 29.96% over the past five years. Birmingham property value According to Zoopla Last 12 months 3.64% Last 5 years 29.96% 0% 5% 10% 15% 20% 25% 30% The shortage in supply, booming demand and rising prices in Birmingham make the city an exciting prospect for property investors, with domestic and international buyers alike turning to Birmingham to bolster their portfolios with healthy yielding investment properties.
03. Rental market insights Birmingham has a busy rental market. The current (December 2017) asking rent in the city is 986 pcm, based on regional figures from Zoopla. That compares with a regional average for the West Midlands of 682 pcm, according to Rightmove s Rental Price Tracker (Q3 2017). The tracker shows an annual rise of 1.5% for rents across the West Midlands and a quarterly change of 0.9%. Zoopla s analysis reveals some interesting insights into the type and size of rental properties available in the city. Apartments command higher rents than houses for properties with one, two and three bedrooms. Current asking rents in Birmingham Average: 986 pcm Price per calendar month 1250 1000 750 500 250 0 1150 847 800 675 590 565 1 Bedroom 2 Bedroom 3 Bedroom In simple terms, Birmingham s tenants are prepared to pay more for apartments than they are for houses. This is reflective of the increase in demand for city centre living that the UK has been experiencing over the past decade or so. Contemporary apartments located close to the heart of the city, and thus providing easy access to amenities, employment opportunities and leisure pursuits are highly sought after. The dream of a detached home, complete with white picket fence, may have been a nice one for the Baby Boomers, but Generation X and the Millennials have different expectations. For some, rising property prices and the inability to save up a deposit due to salaries being so out of step with home values have pushed them into long-term renting. For others, they ve made a choice to rent in order to have a larger, more contemporary home than they would be able to buy. Growing up watching series after series on television of bright young things enjoying the high life from their glamorous, city centre loft apartments has certainly help to shift aspirations.
Sutton Park 20 min drive Jewellery Quarter 15 min walk Symphony Hall 20 min walk The Bullring 12 min walk Gas Street Basin 10 min walk The Mailbox 8 min walk O2 Academy 3 min walk Town Hall 15 min walk BIRMINGHAM CITY CENTRE Grand Central 7 min walk The Hippodrome 2 min walk Silicon Canal 10 min walk New Street Station 5 min walk UCB Campus 4 min walk Being such a vast city, Birmingham has plenty of choice when it comes to areas for people to rent in. To the north of the city, the 970 hectare Sutton Park is Europe s largest urban park, which is ideal for city folk who still want a taste of the great outdoors. The Gas Street Basin area is ideal for foodies, while entrepreneurs and tech-heads will love being close to Silicon Canal. This array of differing areas also presents property investors with choice. The sheer size of Birmingham means that it has property investment opportunities to suit every budget.
04. Economic success and international appeal Birmingham is enjoying economic success thanks to its dynamic workforce and the thriving new tech, digital and creative industries, which have added to the city s established services, retail, tourism and manufacturing sectors. The most recent (October 2017) Birmingham Economic Update shows that GVA rose by 1.2 billion (5.1%) in 2015, while productivity increased by 1.7%. Meanwhile, resident employment rose by 8,700 people during Q1 2017. +1.7% rise in productivity +8,700 rise in employment + 1.2 billion GVA in 2015 Birmingham is investing in ambitious expansion plans to ensure that its success continues. The City Centre Masterplan, which runs from 2010 to 2030, incorporates some 50,000 new jobs. It also includes provision for 5,000 new homes and a range of infrastructure improvements. To date, the Library of Birmingham and the first new city park since Victorian times (Eastside City Park) have been completed as part of the masterplan, supporting Birmingham s continuing position as one of the UK s most modern and exciting cities.
New Street Station has also undergone redevelopment, with 600 million committed to producing the world-class, fit for purpose new transportation hub that was finished in September 2015. Rail passenger numbers at the station went from 16.2 million in 2004/05 to 35.3 million in 2014/15, highlighting the city s huge growth and its need to keep pace in terms of infrastructure provision something with which city planners seem to be coping admirably. Increase in passenger numbers Birmingham 2004/05 16.2million 2014/15 35.3million 5m 10m 15m 20m 25m 30m 35m The new residential and retail area of Smithfield, the new cultural quarter in eastern Birmingham and the 1 billion Southern Gateway also demonstrate Birmingham s commitment to its future. As well as investing in itself, Birmingham is receiving plenty of attention from overseas funders. It is one of the key locations in the UK for receiving foreign direct investment (FDI). The city s affordable space, talent pool and transport links are all influential factors when it comes to FDI decisions. There is an incredible talent pool in Birmingham that offers a wealth of brilliant software engineers. These are people who are often here due to family ties and therefore won t jump ship to the next job offer from Google, adding security for companies. Nick Holzherr, Chief Executive and Founder, Whisk
Chinese investment in Birmingham has been particularly notable in recent years. It was reported in late 2016 to have secured more Chinese investment projects than any other UK regional city, with 23 investments safeguarding more than 1,400 jobs. Meanwhile, in 2017, Birmingham was highlighted as beginning to eclipse both Sydney and New York in terms of its attractiveness to Chinese investors. Some of that funding has specifically been allocated to addressing Birmingham s housing crisis. Chinese property development company Country Garden committed to a 2 billion agreement to deliver housing stock as a result of City Council leader John Clancy s trade mission to Hong Kong and China in late 2016. A consortium of investors from Hong Kong and Macau also pledged 55 million for turning a brownfield site into residential accommodation as a result of the visit. That was followed by plans from Chinese investors for more than 500 apartments in the Digbeth area of the city. There s a housing crisis in this country and Birmingham is no exception. We need more affordable homes, we need more social housing, and we need to give people hope. There can be no one size fits all solution to the housing shortage, but we can make plenty of progress by identifying and pushing ahead with brownfield city centre sites like William Street. City Council Leader John Clancy Data shows that, in 2015, Birmingham was the third greatest recipient of FDI in the UK. The city achieved its best investment results for a decade, based on figures from the EY UK 2016 Attractiveness Survey. In the words of Councillor Clancy, Birmingham is open for business.
05. A bright future ahead Birmingham is a city with its sights set firmly on the future. The City Centre Masterplan, which aims to expand the size of the city s core by 25%, is estimated to be worth 10 billion. In addition to the five areas covered by the masterplan, the arrival of the HS2 rail network in Birmingham will result in some exciting opportunities. Construction of the London to Birmingham HS2 route will last from 2017 to 2026. The new network will reduce the journey time between the two cities to a mere 49 minutes, and its economic impact is already being felt. An independent research report from 2013 estimated that the implementation of HS2 could lead to 26,000 new jobs in the Birmingham/Solihull area, an average gross value added increase of 680 per worker and a 4 billion increase in annual economic output. Birmingham s own investment in HS2, by which it will seek to maximise the network s impact, will include 900 million of funding, much of it focused around the planned Curzon Street Station. The investment marks the first time that a local authority has pushed forward a regeneration project as a result of HS2. I m delighted that Greater Birmingham is making this investment in the future, working to maximise the potential of HS2 by investing in jobs and housing and encouraging more business investment. Prime Minister Theresa May As well as HS2-related development, Birmingham s 500 million investment in the new Paradise Circus business district will support the city s continued economic success. Part of the first phase of that new district, One Chamberlain Square, will be home to PwC when it opens in 2018. Designs for phase two are currently being drawn up. With a long-term focus on regeneration and infrastructure, Birmingham is ahead of the curve with it comes to city planning. It is a city that is working hard to meet the needs of its current and future population, from housing to green spaces to perfect environments for businesses to flourish. It s a city with a bright future ahead. Birmingham has an ambitious growth agenda. We are planning for a significant number of new homes to meet the needs of our growing population and support the growth of our economy. New investment is hugely important to this growth agenda. Together with the recent launch of a 724 million investment plan to maximise the benefits of HS2, demonstrate that confidence in the city is high. The delivery of new homes, quality of life and employment opportunities will continue to see Birmingham as an attractive place to invest. Waheed Nazir, Strategic Director for the Economy, Birmingham City Council
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