Rents are continuing to shoot skywards, with the average rent in England and Wales now standing at £687 a month – 4.2% higher than last year.
According to property group LSL, parent company to Reeds Rains and Your Move, landlords in March increased rents by 0.4% compared with February.
It was the second consecutive month rents have increased.
The group also reported that 9.4% of tenants are in arrears with their rents. Total unpaid rent came to £224m in March, the group estimates.
Regionally, rent rises differed. The greatest monthly increases were in Eastern England, where they rose 2.2% and the South-East where rents increased 1.7%. However, on an annual basis, London is powering ahead: over the course of the last 12 months, rents have soared by 7.3%. The South-East is close behind: rents there have increased by 6.7%.
The biggest monthly decreases were in the South-West, where rents fell 1.6%, and the West Midlands, where they dropped by 1.3%. Smaller monthly decreases also occurred in Wales and Yorkshire and the Humber.
Over the course of the past year, across England and Wales, only the South-West and Wales have registered annual falls in rents – by 2.4% and 1.5% respectively.
LSL said growing rental demand continues to outstrip supply, with most would-be first time-buyers staying in rented accommodation for nearly a decade.
Commercial director David Brown said: “Landlords are not currently seeing bumper capital gains, but strong rental income is providing the bedrock for annual returns. The strong long-term underlying fundamentals of tenant demand and healthy yields are luring more professional landlords to the sector.
“With the recent Budget removing some of the financial barriers towards institutional investment – and making bulk purchases easier – we may well see an increasing number of property funds enter the private rental sector over the medium term.
“Much-needed investment by professional landlords should help alleviate some of the pressure on the private rental sector, preventing rents from soaring into the stratosphere.”