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BIRMINGHAM

Birmingham set to outperform UK average

says JLL as it presents its latest residential predictions


BIRMINGHAM, 21 February 2017 - Rising demand from young professionals, students and investors will drive Birmingham's city centre residential market ever higher in the next five years, according to research from property specialists JLL.

Its 'West Midlands Residential Predictions 2017' report confidently predicts that buoyant urban locations, such as Birmingham, will continue to push house price growth (21.7 %) forecasts above the UK average of 13.1%.

Richard Roberts, JLL's Birmingham-based residential director comments “City centre schemes, such as Grand Central and the New St Station refurb, together with a significant boost to the city's retail, food and leisure offering have changed historical perceptions of Birmingham.

“We are now seeing a turn-around in the appetite and desire for city centre living. The pace of change has played a huge part in the emergence of the Birmingham Private Rented Community (PRC) institutional investment model.

“Progress is gathering momentum, and Birmingham is one of the leading beneficiaries, with several specialist PRC developments set to be delivered over the next five years. Already we've seen forward funding deals agreed for 603 units completed at Exchange Square, near to the proposed HS2 Station, and 334 units at the old Ice Rink site on Pershore Street.

“The city centre is now an attractive place for professionals to live, as well as work, and the main issue now is a lack of supply of quality development sites to satisfy demand.”

Roberts sees rising prices, rents and land values ahead for the next five years, as supply shortages impact the core residential market.

Rental increases have been seen at the top of the market with prime schemes achieving an average increase in rents of 4.9% in 2016.

Roberts also believes that the region's Green Belt will also come under mounting pressure.

The new Housing White Paper suggests the government is anxious to placate MPs who represent constituencies on the edges of the conurbation, by stressing its commitment to the Green Belt.

Roberts though, believes that given Birmingham's supply constraints, it is the surrounding authorities that will have to bear a large burden of land allocations.

“Birmingham's need for 30,000 new homes by 2031 will come into conflict with the government's reticence to tackle Green Belt issues.

“There will be increased pressure to release land on Birmingham's outskirts, as we've already seen in Sutton Coldfield, and this will intensify further once HS2 gets closer to delivery, and as the appeal of Birmingham to broader audience increases,” says Roberts.

“Encouragingly, some adjoining authorities have started taking a proactive approach to land supply problems, recognising the benefits of a well-planned solution. Others however, will be forced by default to address the issue through the Local Plan Review process.”