The rental market cooled slightly over the past few months as the rate of increase in prices slowed – although rents still rose in the three months to May 2016.
Rents agreed on new tenancies in the UK over the past three months were up 4.4 per cent compared to the same period last year, according to the HomeLet Rental Index. This compares to an annual increase of 5.1 per cent in April and 7.6 per cent in May last year.
The average rent in the UK – excluding London – is now £771 a month; the average rent in London is now at£1,563.
Martin Totty, Barbon Insurance group's chief executive officer said there is still a "steady growth in rents" in the UK private rental market "as the number of tenants looking for property runs ahead of the supply in the market".
"That remains the picture in most regions of the country," he said. "While this growth has begun to slow, which tenants will welcome, landlords will also be encouraged by the vote of confidence in the sector evidenced by the increase in buy to let completions in the past few months."
There was a surge in landlords buying up properties towards the end of March, as they snapped-up houses before the government's stamp duty hike came into effect at the beginning of April.
This gave first-time buyers room to breath in the housing market; home sales to first-time buyers hit a two-year high in April.