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18th Jul 2022|Birmingham|Sales|

How will the 2022 Commonwealth Games impact Birmingham house prices?

The 2022 Commonwealth Games will be the largest British sporting event since the spectacular 2012 London Olympic Games and opens up everything that Birmingham has to offer to the entire globe. A predicted one million spectators will attend the games, and a further 1.5 billion people will tune in from across the world to see Britain’s second city in all its glory. This certainly provides Brummies with an ego boost, but what about the economic impact of hosting the Games? The Commonwealth Games Federation have calculated that the impact of the event can boost the local economy of the host city by up to £1.2 billion. This bodes very well for those who own property in the West Midlands, which is precisely what we’ll be covering today…

 

Supply and Demand

It’s no secret that demand for property across the UK is far outstripping supply, meaning that competition for property is exceptionally fierce. This has already increased property prices across the UK, but the Commonwealth Games are sure to exacerbate this disparity between supply and demand by bringing more people and more wealth into the region. Games staff and attendees will surely be swept away by the fantastic progress the city has made, and the impact it has had, potentially leading to them extending their short-term employment contracts or making visits more frequent or permanent, bringing population increases and a long-term uplift in tourism to the city. With 950 jobs set to be created annually after the Commonwealth Games end, and 4,500 jobs having been created per year in the run-up to the event, the pressure to create a solution to the housing crisis in Birmingham has never been more pressing. Alongside this, with the relocation of many high-earning civil service jobs, the ongoing expansion of Birmingham’s business and financial sector, and huge transport and infrastructure projects such as HS2 creating thousands of additional long and short-term positions, we anticipate that demand for luxury apartments and high-end property will soar.

 

More Interest, More Houses

The West Midlands is tackling this supply and demand issue by constructing more homes, with Perry Barr being a fantastic example of this. The 6,500 capacity athlete’s village will be repurposed after the Commonwealth Games into a range of affordable properties with the help of the government’s Housing Infrastructure Fund. Not only does this contribute to easing the disparity between supply and demand, but it provides a sustainable solution to the problem by repurposing existing buildings.

We anticipate that a focus on affordable housing will dominate the New Homes market after the Commonwealth Games as a result of the huge surge in sales and lettings prices across the nation. UK house prices are expected to increase by 4.2 per cent annually over  the next five years, with Birmingham property being particularly lucrative with an estimated 4.9 per cent annual growth that goes far beyond the anticipated national average. What’s more, rental values in the city are expected to get a 2.8 per cent boost each year, making it increasingly difficult to obtain affordable housing, regardless of whether you rent or buy.

 

The Commonwealth Legacy

Over £750 million of investment will flood into Birmingham after the Commonwealth Games conclude as part of the Legacy Fund, which aims to support the communities that have helped host the event and provide them with the means to continue positive change. This involves the use of the events venues after the Games end, making Birmingham and the broader West Midlands region the go-to place for talented athletes and their families. Centrick anticipates that this will drive further investment into the region, with Birmingham positioned as the ideal place to host events of a considerable scale, thereby boosting local businesses, promoting ongoing employment opportunities, and maintaining the steady increase in property value.

The Commonwealth Games will also precede the opening of HS2’s Birmingham station at Curzon Street, which isn’t far from some of the Games’ venues in Smithfield. This allows the legacy of the Games to fuse with the Smithfield Regeneration, and the abundance of opportunity that comes with the opening of Curzon Street. In short, HS2 will open Birmingham up to the rest of the country, specifically London, whilst the Commonwealth Games will provide the catalyst to visit and relocate to Birmingham.

 

Centrick is immeasurably proud to be one of the leading property agencies in the West Midlands, with our central Colmore Row office being just a stone’s throw away from the exceptional venues hosting this year’s Commonwealth Games. We are actively analysing the property market and advising our clients – whether they are first time buyers, Build-To-Rent developers, or portfolio landlords – on how to make their next purchase a success. For more information on your local property market, check out our blog series here, or simply contact one of our team below: we look forward to hearing from you!

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