Average Rental Yield in Birmingham in 2026
Birmingham’s dynamic property market continues its upward trajectory, with strong rental growth supporting excellent returns for investors. Heading into 2026, the city’s appeal remains its compelling balance of affordability and growth potential.
As of late 2025, the average Birmingham rental yield sits at 5.44% based upon an average property price of £234,326 and an average monthly rent of £1,063.
The Investment Advantage
The investment climate in Birmingham is exceptionally competitive. Rents have continued to rise while many are still finding more favourable entry points into the market compared to other major cities.
Birmingham remains a top alternative to London for UK renters. The Birmingham market forecast for 2026 highlights a city that is not only more affordable but is also forecast to deliver some of the best returns and capital appreciation in the country. For context, the average salary-to-house-price ratio in Birmingham is significantly lower than in most London boroughs, sitting at just 3.63 compared to 7.68 in London for a couple, indicating that your tenants can enjoy a vibrant city lifestyle without the capital’s extreme costs. This affordability, coupled with a booming job market, is driving an incredible surge in demand for rental property across the region.
Rental prices in Birmingham are expected to see robust continued growth, having already seen a boost of of 5.1% over the past year. Projections from JLL suggest rental values will increase by approximately 18.8% between 2025 and 2029, the second-highest of the Big Six cities, reinforcing the city’s position as a long-term buy-to-let hotspot.
What is Driving Birmingham’s Rental Yields in 2026?
If you are looking to invest in buy-to-let property, achieving exceptional rental returns relies on micro-market research. The average Birmingham rental yield differs significantly from postcode to postcode.
Returns are impacted by various factors, including the primary drivers of supply and demand, as well as amenities, forecasted growth, local businesses, and transport links.
Overall, Birmingham rental yields are forecast to remain strong in 2026, consistently placing it among the most competitive markets in the UK.
Below is a snapshot of the top-performing areas in Birmingham for 2026:
| Location | Avg. Price | Avg. Rent (pcm) | Avg. Yield |
| B2 | £179,113 | £1,029 | 6.9% |
| B18 | £200,426 | £1,119 | 6.7% |
| B44 | £215,845 | £1,169 | 6.5% |
| B12 | £216,741 | £1,101 | 6.1% |
| B1 | £223,680 | £1,118 | 6% |
| B5 | £219,158 | £1,095 | 6% |
| B3 | £217,832 | £1,071 | 5.9% |
| B42 | £236,305 | £1,142 | 5.8% |
| B11 | £224,201 | £1,046 | 5.6% |
| B15 | £257,153 | £1,200 | 5.6% |
What is Driving Birmingham’s Rental Yields?
The Birmingham rental market is popular for investors because it can offer a perfect blend of high-end, contemporary living and exceptional affordability, making it adaptable to multiple investment strategies.
The success of the ‘Big City Plan‘ continues to transform Birmingham, attracting global businesses, professional workers, and families. With Goldman Sachs, HSBC, and the BBC’s relocation to Digbeth now well underway, the demand for quality housing near key employment hubs is at an all-time high.
Crucial regeneration projects, including Paradise, Smithfield, and Arena Central, are revitalising the city centre and its fringe, creating desirable mixed-use communities that are incredibly attractive to young professionals.
Furthermore, the continued progress of HS2 is set to be a game-changer. By providing a connection to London in under an hour, it will significantly broaden the tenant pool, allowing London workers to live in a more affordable, high-growth city while still enjoying the benefits of the capital. This scenario benefits both London professionals seeking lower rents and Birmingham landlords achieving high occupancy and consistent rental growth.
With 127,600 new homes needed in Birmingham by 2040 to meet quotas and keep pace with growing demand, the inherent undersupply of property will continue to support rising rents and strong yields for the foreseeable future.
Featured Development
No. 30 St Pauls
Birmingham
Introducing No. 30 St Pauls, 58 luxury apartments in Birmingham’s sought-after Jewellery Quarter.
- 1, 2, and 3 bedroom luxury apartments
- Rental values to increase by 18.8% over the next 5 years (JLL)
- Property values to increase by 24% over the next 5 years (JLL)
- 20 % Deposit required
- Estimated completion Q1 2026
- Prime location directly on St Paul’s Square
Prices From
£249,950
Best Buy-to-Let Properties for Rental Yields
What is the best Birmingham buy-to-let property for rental yields? For investors targeting a strategy specifically around rental yields, understanding the property types best suited for delivering rental yields can be incredibly helpful.
| Property Type | Avg. Price | Avg. Rent (pcm) | Avg. Yield |
| Detached | £436,000 | £1,404 | 3.9% |
| Semi-Detached | £272,000 | £1,118 | 4.9% |
| Terraced | £220,000 | £1,063 | 5.8% |
| Apartment | £147,000 | £898 | 7.3% |
This data consistently suggests that apartments in Birmingham deliver the best yields in the market, often achieving yields of over 7%. This far exceeds the average rental yield across all Birmingham properties and offers a lower initial purchasing cost, making them a more affordable and accessible investment.
Apartments appeal strongly to the city’s largest demographic: young professionals and graduates attracted by the city centre’s vibrant lifestyle. For investors looking to start or expand their portfolio in Birmingham, purchasing a modern apartment in one of the city’s core growth districts, such as the City Centre, Digbeth, or the Jewellery Quarter, remains a fantastic strategy.
What Will Affect Your Birmingham Rental Yield?
Rental yields are sensitive to external factors, making consistent, in-depth research a major part of your due diligence.
Regeneration and New Developments: Look for properties near new or upcoming major projects (e.g., Smithfield) which drive tenant demand and command higher rents.
Transport Links: The opening of new Metro tram extensions and the progress of HS2 hubs will significantly impact local property values and rental demand in surrounding areas.
Tenant Demographics: Your target tenant will determine the best property type. High student or young professional populations near universities and business districts will suit apartments or HMOs, while young families may favour larger terraced or semi-detached homes in key suburban zones.
You must remember that the figures above represent gross yields and do not factor in running costs, which may include management fees, maintenance, and insurance. For a precise calculation of net yield, you must consider these factors within your own investment model. Be sure to contact an investment professional or a member of the Joseph Mews team for tailored advice.