Last month, the average rent in England and Wales rose by 0.2% to £720 per month, the lowest monthly increase since February.
Despite the slower pace of increase, rents have risen for nine consecutive months and still remain at a record high.
In London the index puts the average rent at £1,030, a 0.1% rise from September.
LSL Property Services found that tenant finances took a “turn for the worse” with 10.1% of all rent late or unpaid at the end of the month, compared to 8.6% by the end of September.
Unpaid rent in October totalled £287m, an increase from the £243m unpaid in the previous month.
David Brown, commercial director of LSL Property Services said that rents are likely to continue to level out in the run up to Christmas, which is traditionally a slower time for the market.
He said: “Nevertheless, despite the slower rate of increase, the cost of renting is still rising annually at nearly twice the speed of the average salary and many tenants will need to dedicate a growing portion of their disposable income to the cost of accommodation over the next year.”
David Whittaker, managing director of Mortgages For Business, added: “Despite some slowing of growth, rents are still at record levels and investors can sleep tight in the knowledge that yields will remain consistently high.”
Whittaker said that investors would be wise to make the most of current opportunities.
“Over the long term, buy-to-let yields are unsustainable at current levels so we’ll start to see these fall. In addition, George Osborne is likely to announce, in his upcoming Autumn Report, proposals for the government to underwrite first-time buyer loans. This could be the shot in the arm the ailing owner-occupier market so badly needs.”
