Birmingham stands as the UK’s second-largest city, trailing only behind London in both population size and economic prowess. Over the past three decades, the city has witnessed substantial regeneration through its ambitious Big City Plan. This initiative has successfully transformed Birmingham from a so-called ‘concrete jungle’ into a contemporary, livable, and vibrant environment for its residents and the multitude of businesses that call it home.
Given these developments, it’s unsurprising that the city has garnered immense interest from investors.
And if you find yourself considering an expansion of your property portfolio and deciding whether to invest in Birmingham, a tricky challenge is pinpointing a location. This task becomes particularly difficult and risky if you lack local knowledge of the city’s diverse and dynamic neighbourhoods.
Fear not, for this guide is written with you in mind.
In this article, we’ll dive into what we believe are the best Birmingham buy-to-let areas. Furthermore, we’ll explore the local property landscape, offering valuable insights to inform your decision-making process.
Before we get started, if you want to learn more about the BTL and property market in Birmingham, then we suggest listening to our podcast with Sam Richards from Prosperity Wealth. As a property development company boasting an extensive and proven track record in and around Birmingham, Sam has a wealth of knowledge and insights that are not to be missed:
Why Buy-To-Let In Birmingham?
Birmingham has become an excellent choice of location for a buy-to-let property – whether you’re diversifying a growing portfolio or beginning the journey. Here are seven reasons why buy-to-let investors should consider Birmingham:
- It’s popular with young professionals
- It has a strong student community (80,000+ students across three major universities)
- It has a rich industrial heritage with long-term regeneration plans
- It has rapidly growing service industries (such as finance)
- It’s a major transport hub
- It attracts millions of tourists each year (4th most popular city in the UK for tourism)
- Both property and rental values are expected to rise
Investor appetite for Birmingham is growing too. The excessively high costs of investing in London, plus the poor forecasted returns for the city over the coming years (relative to the exceptional growth of the past 20 years), means alternative options in the UK’s other core cities are attracting more and more attention.
For example, the number of people who use Google to search for “property investment in Birmingham” has increased by 129% over the past four years – the strongest growth of any major city in the UK (Manchester is next best with 122%).
So if we know Birmingham is a good investment location and we know investors are increasingly looking for property there, then the next question is: where exactly are the best buy-to-let areas within Birmingham?
One way to answer this question is to consider rental yields. Yields are an excellent measure of performance, given they show the return on investment from rental income, relative to a property’s value. A rental yield of more than 4% is a must to ensure a buy-to-let property runs profitability.
Using industry data, we’ve gathered the average rental yields for every postcode district in Birmingham. The results are in the section below.
Top 10 Areas For Buy-to-Let In Birmingham By Rental Yield
To determine the best buy-to-let Birmingham has to offer, we collected key data on postcode performance. We also performed this analysis last year, before updating it for 2024, so we can now compare which postcodes are trending up, which are new into the top 10, and which are falling down the table.
So, without further ado, the best buy-to-let areas in Birmingham by rental yield are:
| Position | Postcode | Avg price | 5yr Price +/- | Avg rent | Avg yield | Change YoY |
|---|---|---|---|---|---|---|
| 1 | B29 | £299,314 | 28% | £1,874 | 7.5% | No change |
| 2 | B9 | £198,154 | 38% | £1,071 | 6.5% | +1 |
| 3 | B5 | £215,809 | 13% | £1,171 | 6.5% | -1 |
| 4 | B18 | £206,372 | -3% | £1,121 | 6.5% | No change |
| 5 | B44 | £207,395 | 30% | £1,065 | 6.2% | +60 |
| 6 | B37 | £210,665 | 9% | £1,064 | 6.1% | +10 |
| 7 | B15 | £247,019 | 5% | £1,250 | 6.1% | +1 |
| 8 | B1 | £219,098 | 4% | £1,113 | 6.1% | -2 |
| 9 | B12 | £223,717 | 21% | £1,115 | 6.0% | -4 |
| 10 | B32 | £238,232 | 24% | £1,168 | 5.9% | -1 |
Note: Postcodes with the same average yield are sorted by their 5-year price change, from highest to lowest growth.
1. B29 – Selly Oak & Bournbrook
We’ve run this analysis for three years now, and each year, B29 has topped the table. Yet again, it offers the highest rental yields in Birmingham with an average of 7.5%.
B29 is popular amongst students due to its proximity to the University of Birmingham (including its medical school at the Queen Elizabeth Hospital). Student accommodation always tends to attract the strongest rental yields, which helps to explain why B29 came out on top.
The presence of various amenities, including shops, restaurants, and parks, also makes it appealing to young professionals.
2. B9 – Bordesley Green & Small Heath
A newcomer to the top 10 last year, B9 has pushed into second this year – offering a promising average rental yield of 6.5%.
Although this is the same as B5 and B18, it takes second on account of its stunning growth in average property prices over the past five years (38%) – making it a highly profitable return on investment for those who saw the area’s potential early doors.
B9 is a diverse and vibrant area with a mix of housing types, appealing to various tenant demographics. Proximity to green spaces, local shops, and good transportation links adds to its attractiveness for both landlords and tenants.
3. B5 – Digbeth & Highgate
B5 is the third-best postcode on our list, moving down one position from last year. The postcode covers the famed Digbeth, a neighbourhood picked out by The Sunday Times as the ‘coolest in Britain’.
Located within a few minute’s walk of the city centre, Digbeth has a plethora of independent and artisanal restaurants, bars, pop-up stalls, creative spaces like the Custard Factory, digital businesses, and more. Old warehouses and workshops have been lovingly restored to create a new and vibrant community, plus there are plans for an HS2 station nearby.
As a result, and perhaps unsurprisingly, rental property in the area is always in high demand, resulting in a fast-growing property market and excellent buy-to-let yields.
4. B18 – Winson Green & Hockley
Holding onto fourth place, with no change from last year, B18 offers some of the strongest yields in the city.
The postcode area sits just outside the northwest edge of Birmingham’s ring road (also known as The Middleway), starting in Winson Green and Soho before spilling over into the trendy, rejuvenated Jewellery Quarter.
The Jewellery Quarter is a stunning region with a rich history. It’s highly popular with young professionals who enjoy the walkable commute to the city centre, the thriving food and drink scene, and the high standard of townhouses, modern apartment blocks, and period conversions.
Its unique character and history contribute to its continued popularity for renting. As such, it’s no surprise to see it well-represented in our results, with not only B18 but also B1 and B3, which both cover parts of the Quarter.
5. B44 – Kingstanding & Old Oscott
B44 is a new entry for 2024, with an incredible 60 position improvement on last year thanks to a strong 6.2% average yield.
A 15-minute drive north of the city centre, B44 is home to several diverse suburbs. It’s more affordable than many of the postcodes in our top 10 and it has excellent transport links with the M6 and A34 running nearby. All of which makes the area exceptionally popular with both families and commuters.
Housing primarily consists of terraced and semi-detached homes, which have – on average – seen a massive 30% increase in values over the past year, making it one of Birmingham’s best areas for capital appreciation.
6. B37 – Marston Green & Chelmsley Wood
Another newcomer to the top 10, B37 is in 6th. It shares the same average yield (6.1%) as both B15 and B1 but edges them out on property price growth (+9% in the past 5 years).
Sitting 11 kilometres east of Birmingham city centre, B37 is home to neighbourhoods like Chelmsley Wood, Fordbridge, and Marston Green, with a mix of residential comfort and practical amenities.
The housing market in B37 features a variety of options, from modern apartments to spacious family homes, catering to different needs and budgets. The range of options, along with easy access to the city, make it an attractive choice for a wide range of buyers and tenants alike – boosting rental prices.
7. B15 – Edgbaston
B15, up one position, offers a strong yield of 6.1%. The postcode covers Edgbaston, an area internationally famous for its cricket stadium, but better known locally as an affluent suburb adored by families.
Known for its prestigious character, Edgbaston attracts professionals and families looking for quality living in close proximity to the city centre. The area boasts beautiful, historic homes.
Furthermore, the University of Birmingham campus is located within B15, as is the Birmingham City University southern campus – meaning there are students living here too.
8. B1 – Birmingham City Centre
Down two positions year on year, despite a strong average yield of 6.1%, is B1, covering the bustling city centre. With a range of properties, from modern apartments to traditional townhouses, it attracts a diverse tenant base from students to professionals.
City-centre living and the accessibility it provides to shopping, entertainment, and workspaces make it an ever-popular option. As a result, buy-to-let investors would struggle to go wrong by opting for B1.
9. B12 – Balsall Heath & Sparkbrook
Sliding down four positions from last year, B12 offers a yield of 6%.
B12 sits to the east of both Edgbaston’s B15 and Selly Oak’s B29 and instead stretches out southwards from the central and trendy Digbeth down to Balsall Health and Balti Triangle – a reference not only to the local restauranteurs who invented the ‘Balti’ in the 1970s but also to the history of great Indian and Asian restaurants in the area.
Balsall Heath is just north of Moseley, a suburb with a reputation for its creative, bohemian feel. The average property price in Moseley’s B13 postcode is high (£293,000 on average), so those who are priced out of the area may want to live nearby in the more affordable B12 instead.
10. B32 – Bartley Green & Quinton
With a one-position drop from last year, B32 provides a yield of 5.9%. It’s a residential suburb offering a balance of urban and suburban living with good schools, amenities and a variety of housing types.
Although it has an older population, it has great transport access with the M5 motorway close by, and a direct link into the city centre via Hagley Road West. As professionals and young families start seeking more space and better value, this area is a consideration and the data shows solid returns for investors with B32 coming 10th on our list.
Other Areas To Consider
B4 – The Gun Quarter & Aston Triangle
Last year, B4 came 7th in our research. This year, however, it’s dropped out of the top 10 entirely with an average yield of just 5%.
Nonetheless, it’s still a strong contender for buy-to-let investors in Birmingham. On the northeast side of the city centre, the postcode primarily contains The Gun Quarter and Aston Triangle.
The Gun Quarter, much like the neighbouring Jewellery Quarter, is named after the area’s manufacturing past. It is gradually being transformed into a stylish residential area by repurposing old, industrial warehouses as luxury apartments.
Nearby, the campuses of both Aston University and Birmingham City University attract thousands of students each year. Similar to B29, this helps to boost average rental yields in B4 with both purpose-built accommodation and student HMOs performing particularly well.
B3 – Birmingham Central
Another postcode to drop out of the top 10, B3 still offers a solid 5.6% yield.
This area is in the heart of the city’s business district, making it an ideal location for professionals. With a range of luxury apartments and proximity to top restaurants and shops, it remains a sought-after area for renters.
Available Buy-To-Let Properties In Birmingham
Summary
Birmingham is an excellent choice for property investment, with many areas showing strong rental yields and attractive prices – the average price of a property in the city is significantly lower than anywhere in the south, for example.
This research shows there are several standout suburbs, with particularly strong rental yields found in B29’s Selly Oak as a result of the student crowd.
However, whilst this serves as a good starting point for any foray into the Birmingham property market, investors should continue to research each area thoroughly. It’s also wise to consider the long-term capital appreciation of different properties – whilst student accommodation in B29 may deliver the best yields, faster growth in property values is typically achieved on traditional, residential apartments favoured by young professionals, making the likes of Digbeth or Edgbaston brilliant choices too.
If you’d like to discuss the best buy-to-let areas in Birmingham, we can help. We specialise in buy-to-let property, and we’re particularly focused on the markets outside of London – with Birmingham, Liverpool and Manchester being major hotspots.
Frequently Asked Questions
Is Birmingham a good place for buy-to-let?
Generally, Birmingham is a good place for a buy-to-let investment due to its economic power, robust rental yields (which our research shows is up to 7.5% in some areas), and diverse tenant base.
Of course, this doesn’t mean every property in Birmingham is a good choice, so you should discuss your goals, budget and requirements carefully with a professional advisor before investing.
What is the average rental yield in Birmingham UK?
Our research found that the average rental yield in Birmingham was 4.8% (accurate as of 2024), but investors should note that yields can vary significantly between different areas.
Some areas, as highlighted in our guide, offer yields as high as 7.5%. Understanding the city’s diverse property landscape and choosing the right location for investment is essential to maximise your ROI.
About Our Data
The data in this article is an accurate representation of the Birmingham property market as of May 2024. We’ll update this report next year, in 2025, with fresh data.
