New Silicon Valley - An Overview

As one of the UK’s largest cities, Birmingham is planning to become home to an innovation district. Birmingham, Manchester, and Glasgow were identified as the three ‘innovation accelerators’ in the governments Levelling Up White Paper. This is because they were identified as areas that have a strong infrastructure ready to accommodate high-growth industries. 

This is following a statement by Chancellor Jeremy Hunt for the UK to become the ‘world’s next Silicon Valley’. Silicon Valley is an area of Northern California which serves as the global centre of high technology and innovation home to companies such as HP, Apple, and Google. The UK striving for innovation will produce thousands of new jobs and help grow the local and national economies. 

In November, plans were backed by Birmingham City Council leader Councillor Ian Ward. The plans stated that Birmingham should take advantage of the growing tech industry by investing in a brand-new innovation centre. A report by the Centre for Cities, in partnership with HSBC, urged the government to deliver plans with an estimated £14.5bn investment in Birmingham, Manchester, and Glasgow.

What Does This Mean for Property Prices?

The growth in the local economy and average salary in Birmingham will see a boost in property prices. This is due to increased competition in the area and the UK housing shortage, creating a supply-demand imbalance. A rise in residents in Birmingham will likely be followed by an expansion in local infrastructure too, such as leisure activities and amenities. Local infrastructure improves the quality of life for residents, creates a high retention rate and makes the local area more desirable to buyers. 

On average Birmingham property prices are £206,000 according to Zoopla’s latest market report. This is a huge 8.9% growth year on year as a result of the Big City Plan. This is a very attractive prospect for investors as it is far less expensive than areas such as London, where the average property costs £527,000. London has seen price rise by 4.4% over the past year, less than half of Birmingham. If Birmingham is able to attract more technology businesses to the area, we could see property prices close the gap between the two cities.