Move With Us said over the past 12 months prices have increased by 2% adding around £20 per month to the average rent.
Robin King, director of Move with Us, said: “The index confirms a consistent and increasing demand for rented properties across all regions. Many aspiring homeowners struggle to qualify for mortgages which is leading to increased demand in the rental sector. These long-term renters are demanding higher quality accommodation and look to stay for much longer than we have previously seen.”
Over the past fifteen months London has seen large fluctuations in rents including a period of price inflation in the lead up to the Olympics.
Rental prices are still more than twice the national average but have fallen back to more affordable levels in Q3.
The past quarter has seen London rental prices stabilise at around £2,270 after falling from an Olympic induced high of £2,411 in June. They now appear to be recovering from this setback as rents increased by 0.2% in the last two months of the quarter.
Yorkshire and Humber has one of the lowest and most stable average advertised rental rates in Great Britain so a 7% increase in rents was unexpected, said the firm.
The average rent is now closer to the rest of the North and Midlands, at around £602 per month, compared to £559 at the beginning of the quarter.
Move With Us worked with an economist at the London School of Economics and Home.co.uk to construct the new index which is based on a weekly snapshot of over 150,000 rental properties advertised on major portals across eleven regions in the UK covering England, Wales and Scotland.
This allows Move with Us to base rental analysis on upwards of 7.8 million data points annually, one of the largest samples available for a rental index.
But Christopher Down, chief executive of Hearthstone Investments, said any index based on advertised rental prices misses two things.
He said: “First the price listed is often not the price paid and discounts from the advertised rate vary widely by region. Secondly, the data leaves out rent reviews and other changes on properties that are already rented out. That said, more rental data is obviously welcome.”