The Birmingham Housing Market in 2018 – A Retrospective
Since the financial crisis of 2007-08, Birmingham has consistently been one of the best performing housing markets in the whole of the United Kingdom.
Indeed, since the recovery began in 2009, the city has experienced a 45 percent rise in average residential property values, according to research from Knight Frank.
Despite concerns about the effects that Brexit uncertainty would have, the market continued to perform admirably throughout the past year, with positive news emerging for both the sales and rental markets. In this retrospective feature, we take a more in-depth look at the performance of the Birmingham housing market in 2018.
The research presented by Knight Frank shows that Birmingham has been outperforming most of the UK housing market when it comes to price growth, especially since 2015 and that is a trend that continued last year. Despite slowing slightly from 2017, the annual price growth was still an impressive 4.5 percent.
This is in stark contrast with the market at large, with a Guardian report from November 2018 highlighting the fact that UK house price growth fell to its lowest annual rate since 2013. Such data helps to back up the view that Birmingham’s housing market is more resilient to Brexit uncertainty than other regions.
Among the factors that are likely to have contributed towards this robust price growth are: the Big City Plan and upcoming projects like HS2, the increase in number of start-up businesses in the city and expansion of existing ones, and the draw of some of the city’s schools, as a significant number of these have excellent reputations.
Another interesting feature of the Birmingham housing market throughout 2018 was its fast pace, which is itself indicative of the high levels of demand. In fact, a study from Zoopla found that, on average, a Birmingham home owner looking to sell their property waited just 33 days last year to secure an offer.
This makes Birmingham the single fastest-moving city in England and one of the fastest in the whole of the UK, with only Edinburgh, Glasgow and Cardiff outperforming it in this regard. Impressively, this 33 day average is faster than even the fastest-moving individual London boroughs, including the likes of Bexley and Havering.
A major factor contributing to this pace is Birmingham’s status as one of the most popular destinations for people moving away from London, with these moves motivated by the aforementioned lower prices and new start-ups.
It is also notable that the average house price in Birmingham remains lower than in many other parts of the country. At present, the Birmingham average stands at £198,890, which is lower than the average in most other major cities in the UK, including London, Edinburgh and Cardiff – and below the UK average of £226,906 – making it particularly attractive to buyers who are looking to get more for their money, as well as to first-time buyers.
Finally, 2018 also saw good news for landlords and the rental market in general, with average rents increasing. This is perhaps best evidenced by data from Rightmove, which found that the average rent for a two-bed flat in Q1 stood at £860 per month – a figure that is up by more than £100 since Q1 2015.
This increase in average rents has been assisted by high levels of demand for rented accommodation within the city, and that has been driven, in no small part, by students. In total, Birmingham has five universities, along with a University of Law campus and these various academic institutions have increasingly glowing reputations.
In the most recent edition of the respected QS World University Rankings, the University of Birmingham was named as one of the top 100 universities in the world, and it is also now the fourth largest university in the United Kingdom, in terms of student population, according to the Higher Education Statistics Agency (HESA).
In recent years, Birmingham’s housing market has attracted significant attention from analysts, as it has been outperforming most of the rest of the country in a number of key ways and many of these trends continued in 2018. The year again saw above average price growth, as well as fast-pace demand, which is excellent for sellers. For buyers, despite growth, average house prices remained below the national average and below many other major UK cities, making it an attractive prospect, especially when combined with various upcoming city growth projects. Meanwhile, the rental market also went from strength to strength, aided by high demand from students.