Rental incomes in the first six months of 2016 were 1.5% higher than in the same period last year, according to figures by BM solutions.
Average UK monthly rent for a three-bedroom house grew from £772 to £783 the specialist lender has claimed.
Their data shows a distinct North-South divide with the highest yields in the North (6.9%), followed by the North West (6.7%), Northern Ireland (6.2%) and Scotland (6.3%). The lowest rental yields are in London (4.5%), followed by the South East (4.8%) and the South West (4.9%).
Despite this increase in rental income between the first six months of 2015 and the same period of 2016, average gross rental yields fell slightly from 5.4% in H1 2015 to 5.2% in H1 2016.
The South East has seen the largest average monthly rent increase, despite a drop in 0.4% of rents paid in the first six months in 2016, compared to the same period in 2015.
Renters in the South East face the second highest average rent (£1,065pm), followed by those in the South West (£830pm). Northern Ireland has the lowest rent in the UK, at an average of £428pm, around a quarter of the London average. Meanwhile the average rent in the North drops to £511pm, with Yorkshire and the Humber at £531pm and Wales £536pm on average,
Phil Rickards, head of BM Solutions, said: “The buy-to-let market remains strong with sales particularly buoyant up to March 2016, as investors took on properties before the stamp duty reforms in April this year.
“Monthly transactions slowed in April and May as investors planned purchases were brought forward from later in the year.
“We’ve seen the average yield ease slightly and with the impact of the impending tax changes on landlords’ profitability still to be felt, some landlords will need to consider their options in order to cover a reduction in tax relief on mortgage interest.
“With a continued shortage of housing supply however, demand for privately rented accommodation looks sets to remain strong.”
BM solutions is part of the Lloyds banking group, focusing on servicing the buy-to-let, House 2 House and self-build sectors.