The significant rise in house prices in 2014 has led to improved profits for landlords, figures from the Countrywide Residential Lettings indicate.
Taking into account yield and capital appreciation, the average total return is now 12.2 per cent – up from 6.8 per cent in the same period last year.
The increase in total return is only half down to increased yields, with the other half coming from rising house prices.
Before May 2013, around 90 per cent of the average landlord’s return came from rent and the remaining came from capital appreciation of the property.
Over the last year UK monthly rental growth has risen 4.6 per cent with Countrywide claiming that the growth in rental yields has been drive mainly by the south of England.
In contrast average monthly rents across almost all of Northern England have fallen. Birmingham, Manchester and Leeds have bucked the trend however, with the three cities seeing strong growth.