As one of the UK’s fastest-growing regional cities, Birmingham continues to attract renters at record levels. In 2025, new build rental demand in Birmingham is outpacing supply, creating an increasingly competitive market for both tenants and investors. With an undersupply of high-quality rental stock, investors looking for long-term yields and capital growth are finding new builds in Birmingham a highly attractive option.

Birmingham’s Rapid Growth Fuelling Demand

The new build rental demand in Birmingham is driven by the fact that the city’s population has grown significantly in the past decade, with ONS projections indicating that the city will exceed 1.25 million residents by 2030. This surge is driven by young professionals, students, and families relocating for employment, education, and lifestyle.

Major employers such as HSBC, PwC, and Goldman Sachs have established regional bases in Birmingham, and the city is now a key financial and tech hub outside of London. Combined with the University of Birmingham and Aston University, there’s a strong pipeline of renters demanding high-spec, well-located housing.

Why New-Builds Are the Focus in 2025

The shortage of modern rental properties has made new builds particularly sought after. New-build rental demand in Birmingham is rising for several key reasons:

1. Energy Efficiency Standards

With government EPC regulations tightening, new builds meet the new minimum efficiency standards, reducing utility costs and environmental impact. This makes them more appealing to eco-conscious tenants.

2. Lifestyle Amenities

Modern tenants expect more than just four walls. New build schemes in Birmingham often come with amenities like gyms, co-working spaces, rooftop terraces, and concierge services, features that increase tenant retention.

3. Location and Connectivity

Many of Birmingham’s best-performing new builds are located in regeneration areas like Digbeth, the Jewellery Quarter, and Eastside. These districts benefit from proximity to transport hubs, retail, and employment zones.

Key Areas of High Demand

1. Digbeth

A creative hub undergoing rapid regeneration, Digbeth is becoming a hotspot for new build rental demand in Birmingham. New build developments are commanding high rents due to their design quality and walkability to the city core.

  • Average Rent (2-bed): £1300/month
  • Typical Yield: 6-7%
  • Key Developments: Smithfield Birmingham, Metro extension

2. Jewellery Quarter

Combining historic charm with contemporary developments, this area appeals to professionals and couples. New-build demand in the Jewellery Quarter is especially high among tenants seeking luxury apartments with character.

  • Average Rent (2-bed): £1200/month
  • Typical Yield: 5.5-6%

3. Eastside

Eastside is home to HS2 Curzon Street Station and the forthcoming Birmingham Knowledge Quarter. Demand for new rental accommodation is rising as infrastructure and job opportunities expand.

  • Average Rent (2-bed): £1150/month
  • Typical Yield: 6.2%
  • Notable Projects: Eastside Locks, Unite Students accommodation

Supply Constraints

Despite record construction activity, supply is not keeping pace. According to Savills, Birmingham needs over 4,000 new rental homes annually to meet current demand, but only around 2,000 are being delivered.

Key Challenges:

  • Planning delays and high construction costs
  • Land availability in prime areas
  • Investor caution due to economic conditions

These constraints mean well-located, high-quality rental stock continues to command premium prices and low void periods.

What This Means for Investors

For property investors, the supply-demand imbalance presents a clear opportunity:

  • Higher yields in desirable areas
  • Longer tenancies with professional renters
  • Reduced maintenance costs from energy-efficient, modern builds
  • Strong capital appreciation in regenerating districts

Investors targeting new build rental demand in Birmingham should look at off-plan opportunities in emerging hotspots, secure early-buyer pricing, and benefit from projected growth over the next 3–5 years.

How to Identify the Right New Build Investment

1. Developer Reputation

Choose schemes backed by experienced developers with a track record of timely delivery and quality builds.

Proximity to tram, rail, and major arterial routes is vital. Areas along the West Midlands Metro and near HS2 access points will outperform.

3. Tenant Profile Fit

Tailor your property choice to suit the likely tenant base; young professionals, families, or students all have differing requirements.

Final Thoughts: Capitalise on the New Build Rental Demand in Birmingham

In 2025, new build rental demand in Birmingham is significantly outstripping supply, a rare scenario that gives investors the upper hand. Whether targeting high-yield locations like Digbeth or long-term value in Eastside, new builds offer the modern specifications, energy efficiency, and lifestyle appeal that today’s tenants expect.

With strong fundamentals and Birmingham’s continued rise as a core UK city, new-build investment here is not just a trend, it’s a strategic move for any serious property portfolio. Explore Birmingham investments. click here.

New Build Rental Demand in Birmingham