Your Guide to Buying a Buy-to-Let Property in Birmingham

Why invest in a Birmingham property on a buy-to-let scheme? Discover why the UK’s second-biggest city is an attractive proposition for seasoned or budding landlords.

Over the past decade, Birmingham has experienced a healthy degree of regeneration and investment across the city and surrounding boroughs.

Once considered unattractive, “ugly”, and overly industrial, the city has transformed into a diverse hub of creativity and culture.

Testament to this transformation will be witnessing Birmingham host the 2022 Commonwealth Games.   

As a result, Birmingham offers superb potential for property investors, including those who wish to utilise a buy-to-let scheme.

However, with property values predicted to rise by 4.9% each year over the next five years, now is the time to invest. But where do you start? Here’s everything you need to know.

What Do I Need to Consider for Buy-To-Let?

Before investing in a buy-to-let scheme, ensure you adhere to these crucial components and considerations.

Legal Responsibilities

As a buy-to-let property owner, there are specific legal requirements you must meet for the safety of your tenants and to legally protect yourself, such as:

  • Gas Safety Check
  • Smoke and Carbon Monoxide Alarms
  • Energy Performance Certificate (EPC)
  • Tenancy Deposit Scheme/’Prescribed Information’
  • Landlord Selective Licence
  • Furniture and Furnishing Standards
  • Electrical Safety Standards Inspection/Report/ Electrical Safety for Appliances
  • Plugs and Sockets (Safety) Regulations
  • Hygiene Standards (Legionnaires disease)
  • Right to Rent Checks

A buy-to-let landlord must meet these requirements before legally renting out a property in the Birmingham area.


“Location, location, location.” Essential to the type of tenant you suit is the location of the property you own.

For example, if you buy in a quiet residential area close to local schools and parks, you’ll appeal to young families. But, if you wish to invest in a central apartment in the city, you will suit young professionals.

Wherever you buy, the area will satisfy a particular demographic, so be conscious of what type of tenant you want and accommodate their needs in your choice of location for your desired buy-to-let Birmingham property.

Property Type     

A flat or house will suit distinct tenants, while the size and age of the property will also impact the amount of maintenance. Older properties will contain more character and can be acquired for cheaper and rented for higher rates.

The layout of the property is another factor suiting different preferences. A student property or house share may require more rooms and walls for privacy, whereas a young family or couple might prefer an open plan layout.

Don’t Make It Personal

While you will own the property, remember it’s not you who’ll be living there. So, while providing a comfortable and practical place for your ideal tenant, you don’t need to make it YOUR dream home.

As a buy-to-let landlord, you want to give yourself the best chance of finding reliable and respectful tenants. This could mean considering factors that might not be important or relevant to you, such as public transport links, local schools, or whether the house should be open plan or offer more privacy.

It’s almost impossible to cater for everyone, so decide on the type of tenants you want or who your ideal property best meets.

Budget and Mortgage Repayments 

Most buy-to-let property owners will set their rent at 125-150% of the mortgage repayment to cover any ongoing maintenance. It’s vital you set an appropriate budget due to the financial risks involved in being a buy-to-let landlord.

Remember to factor in:

  • Maintenance
  • Renovation
  • The outcome of having no tenants
  • Agency, mortgage, legal fees
  • Landlord Insurance

Consider all financial requirements and eventualities so you can cover yourself financially.

How Much Deposit Do I Need? 

A buy-to-let mortgage in Birmingham is typically 25% of the property value, but this can vary between 20-40%.

Generally, buy-to-let mortgages in Birmingham are interest-only, requiring you to pay interest each month but not the capital amount. 

How Much Tax Will I Pay?

Along with mortgage repayments, there are legal tax requirements that apply. Any income received as rent is taxable and should be payable through your Self-Assessment tax return.

Then your income tax is charged in line with your banding (20%, 40%).

Capital Gains Tax (CGT)

If you sell the property, you’ll essentially gain a profit, so are liable to pay for CGT.

  • Basic CGT tax rate – 18%
  • Higher CGT tax rate – 28%

Stamp Duty Land Tax

Stamp duty amounts depend on the price and location of the property.

Stamp Land Tax for Birmingham includes the following rates:

  • 3% on the first £125,000
  • 5% up to £250,000
  • 8% up to £925,000
  • 13% up to £1.5m
  • 15% on anything higher

Any buy-to-let landlord operating in Birmingham is required to pay these rates.

Inheritance Tax

Inheritance Tax applies to buy-to-let properties, but this amount depends on your circumstances.

You’ll be liable for inheritance tax if your property exceeds £325,000.

Which Buy-to-Let Mortgages Are Available for Me?

Before committing to a buy-to-let mortgage in Birmingham, it’s crucial to compare and assess what various mortgage options are available.

Most buy-to-let mortgages will be interested only, requiring you to pay off the interest, not the amount owed on the mortgage or capital. 

Cheap initial loan options are often outweighed by high fees, while upfront fees are generally significantly higher compared to standard residential rates.

‘Portfolio’ landlords with around four or more buy-to-let properties can expect a challenge with extra funding.

What Are the Advantages of Buy-to-Let Schemes in Birmingham?

Many buy-to-let property owners make a lucrative living from renting their properties, providing they offer good living conditions for their tenants. The advantages of buy-to-let schemes in Birmingham include:

What Are the Disadvantages of Buy-to-Let Schemes in Birmingham?

While becoming a buy-to-let landlord in Birmingham has many benefits, there is also an element of risk involved. For example:

  • Increased tax bills
  • The risk of the property becoming unoccupied
  • If property prices fall, then your capital will reduce
  • Maintenance demands and difficult tenants

What Are the Options in Birmingham?

Beyond the city itself, Birmingham has many boroughs of superb potential for a buy-to-let investment.


Eight miles to the southeast of Birmingham, Solihull offers buy-to-let landlords a variety of property options in a balance between city and countryside.

Areas such as Olton offer buy-to-let average property prices under £200,000.

King’s Heath

King’s Heath is just four miles below the city center and has become a popular area for young professionals looking to rent.

It presents affordable accommodation to young couples and post-graduates in an attractive region with just a short commute into the city centre.


Longbridge offers buy-to-let property owners encouraging growth for potential. Regarded as an up-and-coming region with average property prices sitting below £200,000 and enjoying a £1 billion regeneration investment to improve the local community. 

Need Any Advice for a Buy-To-Let Property in Birmingham?

The Birmingham property market provides a unique opportunity to buy-to-let investors compared to most other UK areas. So, the incentive to invest could not be more pressing, with property prices set to dramatically increase between now and the next five to ten years.

But no matter where you are, a buy-to-let scheme comes with a degree of risk and should not be rushed or taken lightly without the necessary knowledge and guidance.

If you’re interested in a buy-to-let scheme in Birmingham, we suggest you seek some advice before investing. At Wes Bromwich Money, we’re an established organization with expert knowledge of the Birmingham property market.

We can offer you simple and smart advice specific to your unique needs. Get in touch with us today for some helpful and honest guidance on buy-to-let schemes in Birmingham.   

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