The average rent across England and Wales has increased by 0.4% in the last 12 months, hitting an average of £861 per calendar month (pcm) in February, the latest figures from Your Move show.
Rents in the South West continue to outperform all other regions, increasing by 4% to reach an average of £703pcm last month.
The prosperity in the South West comes as many landlords look beyond London for higher yields and cheaper purchase prices for new properties. Cities in the South West such as Bristol have continued to boom in popularity, with this increased demand causing rents to rise.
Martyn Alderton, national lettings director at Your Move, said: “Renters have been drawn to Bristol, not only because of its vibrant arts and cultural scene but also its strong job prospects. This has been accompanied by a boom in build to rent in the city, which has driven up demand and the average rent across the region.”
Other beneficiaries of this shift away from London were the West Midlands, where prices rose 3.1%, and the Yorkshire and Humber region, which saw rents increase by 2.1%.
In the West Midlands the average rent now stands at £636 while in Yorkshire that figure is £588.
Yorkshire is currently the second cheapest place to rent property just ahead of the North East, where the average rent is £540pcm, up 1% year-on-year.
Rents increased across all regions monitored in the survey, with the exception of London and the East of England, where the average rent dropped to £878pcm and £1,260pcm respectively.
Looking at rental returns, it is easy to see why many landlords are looking to the north of England for their next purchase, as yields in these regions continued to outstrip those in southern areas.
According to Your Move, the average return on properties in the North East was 5% during February, closely followed by the North West at 4.8%.
Alderton continued: “Private landlords meanwhile have tended to prefer the charms of the north of England, a region where yields are significantly higher than elsewhere.
London landlords saw the smallest percentage returns, with a typical property in the capital yielding 3.2%.
On an absolute basis, the returns in the capital are much higher thanks to the more expensive property prices in the area.
The returns in each of the ten regions surveyed were the same in February as January. The average yield across all of England and Wales was 4.3%, down from 4.4% a year ago.
Alderton added: “Returns in all regions have remained steady compared with January, meaning landlords across the country have enjoyed solid yields.”
The Your Move data also reveals that tenant arrears remained below 10% once again in February, with 9.4% of all tenancies were behind on their payment, slightly up compared to the 8.8% recorded in January but well down on December’s 10.5% figure.