Property prices and rents across the West Midlands are moving in sharply different directions depending on location according to latest research presented by property analyst Kate Faulkner OBE for the National Landlord Investment Show.
The analysis highlights widening differences between Birmingham, Coventry and Sandwell, with Faulkner warning landlords and investors against relying on broad national housing market headlines when making decisions.
While property prices across the West Midlands remain below UK and England averages, potentially continuing to attract investors and first-time buyers seeking relative affordability, local performance varies significantly.
Coventry recorded the strongest annual house price growth among the areas analysed, with values rising by 2% year-on-year. The wider West Midlands saw growth of 1.6%, while Sandwell recorded a 1% increase. Birmingham lagged behind, with prices rising by just 0.7%.
LONG-TERM PERFORMANCE
Faulkner says: “What matters most when assessing a property market is how it performs over the long term. Short-term rises and falls can be misleading, particularly for landlords and investors who need to understand whether a property is genuinely delivering sustainable returns over time.”
The research found that since the market peak before the 2008 financial crisis, property prices in Birmingham, Coventry and particularly Sandwell have outperformed wider UK and England averages. Yet once inflation is factored in, real-term price growth has been far more modest.
Looking back to 2005, Sandwell emerged as the strongest long-term performer, recording average annual price growth of 3.4%, ahead of inflation.
The report suggests that Birmingham could now present opportunities for buyers and investors following weaker price growth since the 2022 mini-budget and higher mortgage rates.
Recent data from TwentyEA and Chris Watkin shows there are currently 14.6% more properties on the market than the long-term average, giving buyers greater choice and stronger negotiating power.
RENTAL MARKET
Annual rental growth across the West Midlands currently stands at 4.8%, ahead of the UK average of 3.4%. Sandwell recorded the strongest increase at 10.1%, significantly outperforming Birmingham (3.5%) and Coventry (2.7%).
Faulkner says the growing pressures facing the private rented sector are increasingly linked to wider housing shortages.
She adds: “National headlines often suggest rents are soaring everywhere, but the reality is far more complex and highly localised.
“While many tenants are genuinely struggling with affordability, part of the pressure on the private rented sector is also being driven by the shortage of social housing, with many households renting privately when they would traditionally have been housed in the social sector.”
