As of April 2025, Birmingham’s rental market is experiencing robust growth, driven by a combination of strong demand, limited housing supply, and significant urban development.
These factors position the city as a prime location for property investors and landlords seeking both capital appreciation and steady rental income.
The Market as it is
Property experts LandlordBuyer, who help landlords who are selling a property with tenants, researched the average monthly rent in Birmingham. In March 2025, the average monthly rent in Birmingham reached £1,050, marking a 6.8% increase from £983 in March 2024. This upward trend is consistent across various property types
- One-bedroom properties: £791
- Two-bedroom properties: £957
- Three-bedroom properties: £1,077
- Four or more bedrooms: £1,522
Flats and maisonettes averaged £878 per month, while detached properties commanded higher rents at £1,388.
Rental yields remain attractive, with city-centre areas like Digbeth and the Jewellery Quarter offering yields between 6% and 6.5%. The average rental yield across Birmingham stands at approximately 5.21%, reflecting the city’s strong investment potential.
What’s driving this demand?
Several factors contribute to the sustained demand in Birmingham’s rental market:
- Population Growth: Birmingham’s population is projected to reach 1.24 million by 2030, with a significant proportion aged between 20 and 35. This demographic is more inclined towards renting, fuelling demand for rental properties.
- Educational Institutions: The city hosts over 80,000 students, leading to a high demand for student accommodations. Popular student areas like Selly Oak and Harborne are experiencing increased rental pressures.
- Economic Development: The relocation of major corporations, such as Goldman Sachs and HSBC, to Birmingham has boosted employment opportunities, attracting professionals seeking rental housing.
- Infrastructure Projects: The ongoing development of the HS2 high-speed rail project is expected to enhance connectivity, making Birmingham more accessible and appealing to commuters.
What’s in store for the rest of 2025 and beyond?
Looking ahead, rental prices in Birmingham are projected to continue their upward trajectory:
- 2025: Rents are expected to rise by approximately 4%
- 2026: A further increase of 3.5% is anticipated.
These projections align with national trends, where UK rents are forecasted to grow by 17.6% between 2025 and 2029.
The Build-to-Rent (BTR) sector is also gaining momentum in Birmingham, with developments like Affinity Living Lancaster Wharf nearing completion. These projects cater to the growing demand for high-quality rental accommodations, particularly among young professionals.
LandlordBuyer’s Managing Director, Jason Harris-Cohen says
“Birmingham’s rental market is poised for continued growth through 2025 and 2026, underpinned by strong demand, limited supply, and ongoing urban development. For landlords and investors, the city presents an opportunity to achieve both attractive rental yields and capital appreciation. As Birmingham continues to evolve, it solidifies its status as a leading destination for property investment in the UK.”
