The average rent has risen 1.6% in the last 12 months compared to annual earnings growth of 0.8%.
Despite a slight fall month-on-month between October and November the average rent in England and Wales now stands at £753 per month.
London was the market with the largest increases in rents with prices in the capital 4.4% higher last month than they were a year ago.
The South West and South East also saw rises of 3.4% and 3.2% respectively. The East of England saw the biggest falls in rents with the typical property falling 5.5%, equivalent to £42.
Landlords across England and Wales have seen the average yield reach 5.3%. This represents an average return of £14,592 based on rental income of £8,243 and capital gain of £6,349.
David Brown, commercial director of LSL Property Services, said: “Over 12 months the availability and affordability of buy-to-let finance has achieved a quiet revolution – with a very real effect on the private rented sector. Demand for homes to rent is still soaring, yet heavy investment by landlords in 2013 has brought rent rises in most areas below inflation.
“In 2014, one thing will remain certain – demand from new tenants will continue to grow. Supply of new homes to rent will be critical in maintaining relatively affordable annual rent rises, compared to rampant house prices.”
