The average landlord who sold their rental property in 2017 made a gain of £86,651 from when they bought it – which was on average 8.7 years ago.
The Countrywide Monthly Lettings Index found sellers in London gained £253,981, over four times more than those selling outside the capital.
One in four landlords (28%) who sold their home in London did so for at least twice what they paid for it an average of 8.1 years ago.
Johnny Morris, research director at Countrywide, said: “House price growth has driven investor gains.
“Landlords selling in 2017 owned their homes for nearly nine years. In 8 of those last 9 years house prices have risen. Even in areas where price growth has lagged behind most landlords have made a profit from rising prices.
“Rents continued to grow in January. London continues to see the greatest falls in the stock of available homes to rent, on the back of reduced investor activity, this scarcity of supply is driving rental growth.”
Landlord gains are slightly behind owner occupiers, who on average made £92,886 when selling their home in 2017.
The average owner occupier made 7% more than a landlord when selling their home last year. This is because the average landlord selling their property in 2017 owned it for 8.7 years, rather than nine years for an owner occupier.
With the highest house prices and strongest capital growth over the last nine years, landlords who sold in London and the South East generally made the biggest gains.
Eight of the 10 places where landlords made the highest percentage gains were in London, with Maldon in Essex (118%) and Pendle in Lancashire (109%) being the only exceptions.
Landlords in the North East made the smallest gains, £23,874, over 10 times less than a landlord in the capital. Landlords selling in Selby in North Yorkshire made the lowest percentage profit of 14%, but still made £9,703 on average.
The average cost of a new let rose to £954 per calendar month in Great Britain in February 2018. But the rate of annual rental growth slowed to 1.5%, down from 2.4% the previous month.
Rents in London grew-faster than any other region for the third month in a row to stand at £1,686, 3.1% above last year’s level. Scotland was the only region to see rents fall in February.