Landlords profit from the housing price boom

Near record rental values coupled with the rise in house prices will generate average returns of 13% in the next twelve months, more than Ј22,000 per property, a report found.

It also revealed rents are within Ј1 of their all-time high at Ј743 a month in England and Wales. August's figure marks a 0.7 per cent increase on July and is up 1.3 per cent on August last year.

David Newnes, of lettings giant LSL Property Services, which released the report, said if rental property prices continue to rise at the same pace as over the last three months the average buy-to-let investor should make a total annual return of 13.1 per cent over the next 12 months - equivalent to Ј22,065 per property.

London is driving the rise in rents in the capital rising three-and-half times faster than England and Wales over the last 12 months.

They are now averaging Ј1,126 in London, 4.8 per cent higher than last year. Official figures also showed that house prices in London are up by nearly 10% year-on-year, indicating the strength of demand for homes in the capital. telegraph