Home to five universities and over 80,000 students, Birmingham is one of the top spots in the UK for student property investors.
Birmingham, known for its industrial history, incredible diversity, and various case studies in urban regeneration, has become a magnet for students from around the world. This influx of students naturally translates to a booming demand for quality accommodation, making the city a fertile ground for property investment.
However, Birmingham is huge – 268km² in area, to be precise. That’s the second-largest in the UK after London, and more than double the size of Manchester (115km²).
And with the city’s five universities spread across several campuses, knowing where to invest in student accommodation can be challenging, particularly if you’re unfamiliar with the city’s landscape and student preferences.
Our guide is here to help. Leaning on our experience of the local property market, we’ll provide a comprehensive overview of the top areas for student investment property in Birmingham. Whether you’re a seasoned investor or a newcomer, this article will equip you with the insights needed to make informed investment decisions.
We’ll cover:
- Why Birmingham is a prime location for student property
- The 5 best areas for student property investment in Birmingham
Why is Birmingham a prime location for student property?
Birmingham stands out as an excellent choice for student property investment due to its substantial student population and dynamic growth.
Firstly, Birmingham is home to five major universities: the University of Birmingham, Birmingham City University, Aston University, University College Birmingham, and Newman University. According to data from the Higher Education Statistics Agency (HESA), these institutions collectively enrol over 90,000 students. This makes Birmingham one of the largest student hubs in the UK, rivalling cities like Manchester and Leeds.
A large student population is just the beginning. Here are three key reasons why Birmingham is really worth your attention:
- High rental yields: Birmingham consistently generates impressive rental yields, particularly in areas with high student density. Our research indicates that certain postcodes, like B29, home to the student-dominated Selly Oak, offer some of the best returns on investment in the country.
- Undersupply of student accommodation: Despite the presence of numerous universities, Birmingham faces a significant shortfall in student accommodation – particularly Purpose-Built Student Accommodation (PBSA). Recent reports suggest a deficit of 12,000 beds, which pushes rental prices higher and means very few student landlords experience void periods.
- City-wide development: Birmingham’s ongoing urban regeneration projects and the expansion of its universities (both the University of Birmingham and University College Birmingham have clear plans) should attract even more students to the city over the coming years, and drive capital appreciation in local properties.
The best areas for student property investment in Birmingham
Okay, so now we know why Birmingham offers an excellent investment opportunity, the next question is where should investors be looking?
Using industry data, research and our local expertise, we’ve narrowed down a shortlist of the 7 best postcodes in the city for investors interested in student houses.
| Postcode | Area | Avg price | Avg rent p/m | Avg yield | 5yr Price Change |
|---|---|---|---|---|---|
| B29 | Selly Oak | £310,995 | £1,823 | 7.0% | 33% |
| B5 | Edgbaston/City Centre | £217,132 | £1,156 | 6.4% | -5% |
| B15 | Edgbaston | £240,048 | £1,260 | 6.3% | 3% |
| B1 | City Centre | £217,918 | £1,118 | 6.2% | 4% |
| B4 | Aston University | £260,729 | £1,152 | 5.3% | 17% |
| B3 | City Centre | £217,140 | £1,035 | 5.7% | 11% |
| B17 | Harborne | £405,638 | £1,362 | 4.0% | 23% |
Let’s take a more detailed look at these areas.
Selly Oak (B29)
Selly Oak is the go-to spot for those attending the University of Birmingham.
Renowned for its lively atmosphere, proximity to the university, and host of bars and pubs, Selly Oak has long been a favourite among students looking for the classic “uni experience”.
It’s not just University of Birmingham students either, despite other campuses sitting further into the centre, many students will opt to live in Selly Oak due to its reputation. Fortunately, there are easy rail and bus links into the city centre, making commuting simple.
With the above in mind, unsurprisingly, the demand for student accommodation in Selly Oak consistently outstrips supply. This drives rental yields to impressive heights. In fact, with an average yield of 7.00%, Selly Oak’s B29 postcode has the strongest yield in Birmingham – making it one of the most lucrative areas for student property investment in the entire country.
Additionally, property prices in the area have seen a 33% increase over the past five years, indicating strong capital growth potential for investors.
One thing to keep in mind though, student properties in Selly Oak may require higher-than-average maintenance and repairs due to the heavy usage. Don’t let this put you off, but make sure to keep it in mind and ensure you have adequate deposits and maintenance plans in place.
Edgbaston (B15, B5)
Edgbaston doesn’t quite have the same reputation as Selly Oak, but it’s close by.
Plus, the main University of Birmingham campus actually sits inside Edgbaston’s B15 postcode. This makes it a natural choice for many students – especially those who couldn’t secure a property in Selly Oak.
Edgbaston is larger and more diverse, too. It not only attracts students, but families, young professionals, and others all enjoy the slightly more affluent feel, with leafy streets, elegant Victorian homes, and modern apartments a main feature.
Yields are still very strong. B5, encompassing parts of Edgbaston and central Birmingham, is a prime location and hits yields of 6.4%. Meanwhile, B15 has a very competitive 6.3% average rental yield.
Aston and Birmingham City University (B4)
The B4 postcode is popular with students attending either Aston University or Birmingham City University, as it encompasses the campuses of both.
While other areas are home to traditional student HMOs (terraces, converted Victorian homes, etc), B4 has PBSA – privately-owned apartment blocks built specifically for students. This type of accommodation generally attracts students willing to pay more for higher quality living, hence a very healthy 5.3% yield in our data.
Plus, as B4 is essentially in Birmingham city centre, it offers easy access to a range of amenities that cater to the student population. From supermarkets and cafes to gyms and nightclubs, everything is within walking distance.
City Centre (B1, B3, B5)
Following on from B4, it makes sense to highlight the rest of the city centre.
Consisting of postcodes B1 to B5, the area is a popular choice with students given its central location for all of the city’s universities. Campuses can be easily reached on foot, by bike, or via public transport.
Similar to B4, you can expect to find mostly PBSA projects in the centre. That said, some students may venture towards the Jewellery Quarter for traditional housing.
Yields are strong in the city centre. B1, for example, achieves an average yield of 6.2%, while B3 hits a solid 5.7%.
Harborne (B17)
Picturesque streets lined with Victorian and Edwardian houses, a vibrant high street, and numerous green spaces. Harborne, located in the B17 postcode area, is one of Birmingham’s most desirable suburbs.
With a charming village feel, excellent amenities, and strong community spirit, you could be forgiven for questioning why Harborne is on a list of areas for Birmingham student property investment?
Well, as it’s only a short distance from the University of Birmingham, it does draw in some student residents. In particular, mature students and post-graduates trying to avoid the 24/7 buzz of student life in neighbouring Selly Oak.
The data isn’t particularly strong for Harborne, with the most expensive values on our list and, by far, the lowest yield (4%). That said, B17 is a large postcode and we wanted to include it because we would expect variance based on the street – those closest to the Uni campus should generate much stronger yields, for example.
Summary
As one of the UK’s major educational hubs, Birmingham boasts a substantial and growing population of domestic and international students spread across its five universities. Yet, with an undersupply in PBSA, there is a constant demand for quality student accommodation.
This makes Birmingham an outstanding opportunity for student property investors.
If you’re considering expanding your property portfolio, then we hope our data and research will help guide you. Each of the areas we’ve covered has its own advantages, catering to different investment strategies and goals.
Want to learn more, or need help with your search?
We can help you find the perfect property to match your needs. We specialise in buy-to-let properties, focusing on both residential and student markets across the UK. Our expertise and local knowledge will guide you through the purchase process, ensuring you make informed and profitable decisions.
You can reach us by filling in the form below, and we’ll call you back to organise a free consultation.
About Our Data
The data in this article is accurate as of July 2024. We’ll update this report next year, in 2025, with the latest insights and fresh data.
Dive Deeper
Want to learn more about the Birmingham property market? Then read our guide to the best buy-to-let areas in Birmingham.
