Rents have jumped by 8.3 per cent in a year to an average £969 a month, according to property website Zoopla.
Demand for rental homes was 76 per cent higher than the New Year markets between 2018 and 2021.
However, the amount of rental properties available across the UK is 39 per cent lower than the five-year average around this time of year.
Zoopla said the shrinking stock of homes for rent is down to falling buy-to-let investment over the last five years.
The imbalance in supply and demand is helping to drive prices higher, with average rents up nearly 12 per cent over the last five years, the property website found.
Rent now accounts for more than a third – or 37 per cent – of gross income for a single earner.
City centres are expected to see continued demand in the coming months, which will underpin rental growth, Zoopla predicted.
It comes as tenant numbers recovered across the central districts of all major cities, including Birmingham, Edinburgh, Leeds and Manchester, after taking a hit during the pandemic.
Inner city London has seen rental growth of 11 per cent compared to the same time last year.
Gráinne Gilmore, head of research at Zoopla, said: “Rents have risen sharply in recent months, amid a backdrop of rising living costs. But it is important to point out that in terms of rental affordability, in most markets rents are still close to the 10-year average.
“As demand continues to outpace supply, there will be further upward pressure on rents, but affordability considerations will act as a brake on large rises.
“In addition, the January peak in rental demand will start to ease in the coming months, putting less severe pressure on supply, which will lead to more local market competition, and more modest rental increases.
“The flooding of rental demand back into city centres thanks to office workers, students and international demand returning to cities means the post-pandemic ‘recalibration’ of the rental market is well underway.”