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Investing in Birmingham after the Commonwealth Games

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The Commonwealth Games has had a truly transformative effect on Birmingham and the wider West Midlands, making it an increasingly popular region to live, work and invest in. As banners for the event suggest, ‘Sport Is Just The Beginning’ and there’s huge potential for the region to experience a significant upsurge in activity, both property-related and culturally.

The Impact On Property Prices

Birmingham provides the ideal location for new and experienced investors to make their next property purchase. It provides a viable alternative to the traditionally popular London investment, especially for those looking to invest in premium city living space but wishing to avoid London property prices. Birmingham’s average properties are 60% cheaper when compared to London, yet arguably offer a comparable amount of opportunities for renters alongside better rental yields for investors.

Having already seen a 56% increase in property prices over the past 10 years, the city is set to experience a further 27% growth by 2026, with the Commonwealth Games being a primary catalyst for this rapid uplift. This is due to the increased confidence developers and businesses have in the region, which is encouraging more people to move, grow and invest in the city. The same can be said for rental yields, with the average rent increasing by 10% in the year leading up to the Commonwealth Games. This trend is anticipated to continue, with JLL predicting that rental values will increase by a further 2.6% over the next 12 months. In the current cost of living crisis, and with inflation on the rise, this prediction speaks volumes.

The Future Of Birmingham

Although the Birmingham Commonwealth Games has now concluded, this does not mean that the city will no longer reap the rewards of the Games’ legacy. Quite the contrary: over £1 billion of investment has been generated from the Commonwealth Games, creating a buzz around what the future of Birmingham might hold.

The Commonwealth Legacy Fund is already starting to make its mark on communities across the region by promoting long-term investment. Over £6.5 million has been set aside exclusively for the Legacy Fund, and has been pledged to two distinct community-building schemes.

The first scheme, the Commonwealth Active Communities Fund, seeks to enrich neighbourhoods across the West Midlands by providing unrivalled access to the extensive canal networks and parks across the region and regenerating these outdoor spaces for the benefit of their neighbourhoods. This spells good news for investors, who will likely see their property portfolios increase in value as the surrounding parks and waterways are revived.

The second scheme, the Places and Spaces Fund, will focus on funding community projects centred around sport and fitness, which will ensure that more neighbourhoods across the West Midlands have access to specialist sports facilities. Akin to the Active Communities Fund, this scheme will provide more opportunities for local residents to get involved in their communities and could result in longer tenancies for renters and higher property prices for buyers and sellers.

What’s more, an additional 1,000 homes are currently under construction in Perry Barr, with these units anticipated to be sold or let extremely quickly as they are located adjacent to the famous Alexander Stadium, home to the Opening and Closing Ceremonies at the Games. This regeneration is set to boost existing neighbourhoods, whilst sustainably creating new ones that offer fantastic access to world-renowned sporting facilities.

Why Now Is The Best Time To Invest

The Manchester 2002 Commonwealth Games saw a rapid decline in unemployment in the region of 23.5%, with a similar effect anticipated for the West Midlands in the coming months and years. This projected spike in employment coincides with a number of other developments across Birmingham, namely the upcoming HS2 station at Curzon Street. The rail network won’t just open up Birmingham to the rest of the UK – and perhaps many London commuters seeking to escape the high house prices of the capital – but is set to create sustainable growth throughout the city. With HS2 already having produced 25,000 jobs across the country, the opportunities offered by the new rail network are not only exciting for Birmingham locals, but pose a fantastic opportunity for investors, as this increase in mid to high-earning employment opportunities will inevitably impact the local economy and therefore the housing market. A report from Lloyds Bank succinctly explains this correlation:

“A strengthening job market helps to boost confidence, puts more cash into customers’ pockets and also makes it easier to secure a mortgage”

Additionally, the relocation of many businesses to Birmingham is sure to create even more job opportunities, and thereby more competition for property. The city is already home to employers at Goldman Sachs, Deutsche Bank and HSBC, all of which have launched sizeable business hubs in the city centre, with other businesses following in their footsteps. The BBC’s relocation from The Mailbox to Digbeth signals a renewed faith in the city’s creative quarter, and could mark an important shift that encourages other digital media companies to consider moving into Britain’s second city, especially as the Commonwealth Games put Birmingham’s creative flare on show to the rest of the globe.

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