Cost of renting on the rise again But at £1,126 typically, rents in London rose at a much faster rate than inflation and are up by 4.8pc year-on-year. Official figures released earlier this week showed that house prices in London are also up by nearly 10pc year-on-year, indicating the strength of demand for homes in the capital. Wales saw the second biggest annual increase in rents, with a 2.3pc uplift taking average rents to £561. The South East recorded the strongest month-on-month growth, with a 2pc rise pushing monthly rents to £762. By contrast, rents in Yorkshire and the Humber are 1.6pc lower than last year, at £536 typically, followed closely by a 1.5pc annual fall in the North West, taking average rents to £582. The North East saw the biggest month-on-month drop in rents, with a 0.8pc fall taking average rents to £523. Across the country, rental inflation had been cooling off for much of this year following the launch of Government schemes to give people with low deposits a helping hand on to the property ladder. First-time buyer numbers have reached their highest levels in more than five years following initiatives such as Funding for Lending and Help to Buy, which have widened access to mortgages and allowed some people who were previously trapped in renting to break free. But David Newnes, director of LSL Property Services, said that weak income growth, which has an impact on households' ability to borrow, and a lack of housing supply means that the private rental sector is continuing to see strong demand from new tenants. He said the upward pressure on rents is also coming from an uplift in student renters returning to the market as the new academic year begins. Mr Newnes said: "Better availability of finance has allowed some households to leave the rental market. And rents certainly felt the short-term impact of that. But releasing a blast of pent-up pressure to buy a home is unlikely to change the long-term trend in renting. Although Government schemes are helping, buying a first home is still extremely hard on the back of low salary growth. Rents have been rising again over the summer and yields, the profit for landlords, is stable Tenant finances also improved in August, with 7.8pc of rent late or unpaid during the month, down from 8.1pc in July. Mr Newnes put the improvement in part down to the softening of rental inflation seen earlier this year which gave tenants some "relief." Housing Minister Mark Prisk pointed to official figures which suggest rents are not rising. He said: "Official Valuation Office Agency figures show that median rents were unchanged nationally over the past year. However, this Government is determined to kickstart a bigger, better private rented sector that gives tenants more choice. That's why we're getting Britain building more rented homes, with a £1 billion investment to help developers build to rent and a further £10 billion in loan guarantees to help grow the number of rented and affordable homes. For those looking to make the move from rent to home ownership, there is a range of Government-backed schemes on offer, which have already helped nearly 26,000 hard-working people achieve their dreams of buying a home. We've also delivered 150,000 affordable homes in England over the last three years, meaning we're heading towards the highest rate of affordable housebuilding for two decades. Campbell Robb, chief executive of Shelter, said the findings were "more bad news for England's nine million renters." He said: "Sky-high house prices have left millions with no option but to make a home in our overheated and expensive rental market. With increased demand pushing rents up ever higher, there's no sign of things getting any easier for the families already struggling to make ends meet. Until we get to the root of the problem by building more affordable homes, more and more ordinary people are going to be left behind by our housing shortage.