Insight 9 | Where is best to invest?
Since 2010, monthly rents across England and Wales have grown by 3% a year to reach an average of £763, according to the latest research. The private rental sector has been growing since 2001, accelerating during the crash to include 4m households (18%) in England and Wales by 2013, says the Office for National Statistics. This all means there is plenty of opportunity for income-focused investors.
With the impending influx of investors coming into the buy-to-let market, I am being asked “where is best to invest?”
If I could pick one place to look with good returns and strong demand, I would suggest Birmingham City Centre.
Birmingham offers a 6.22% return. There are big redevelopment plans in Birmingham and business is booming. The Big City Plan will help loosen strictures put around the city centre by main roads, allowing it to expand. It will also ease access to desirable residential areas such as the Jewellery Quarter, where Victorian factories are morphing into Shoreditch-style lofts.
The business renaissance, with demand for office space hitting a high at the end of last year, and the rush of twenty & thirty somethings moving from London to the second city means there is a great demand for city centre property. The lack of supply of new housing in the city will underpin prices.
I suggest taking advantage of young professionals’ desire to live centrally around B1’s hotspots of Brindleyplace and the Mailbox as well as the Jewellery Quarter. Gross yields on two-bedroom properties here, priced around £185,193 on average, are 6.8% — beating the city’s average of 6.22%.