The cost of renting a property in London reached an all time high, despite a slow down in the increase of average salary, meaning tenants in the capital are feeling the pinch more than ever, according to new data from the lettings service specialists Homelet.

The latest data shows that the average rental price in Greater London increased up to £1,202 in August, compared to the £1,154 recorded in July – a record breaking amount, despite continual economic instability.

This is an increase of 12.2% in average rents compared to the same time last year, suggesting demand for rental properties in London is on the up as people remain unable to get onto the property ladder due to lack of mortgage availability and rising house prices.

Over the same period, the average salary of tenants in the region has increased by just 2.4%. This large gap in rental and salary increases indicates how London residents are feeling the squeeze. Although this means many tenants are experiencing financial strain, landlords are benefiting from the increasing rental income.

Another statistic from the August HomeLet Rental Index shows that the average tenancy length in Greater London dropped in the last two years from 27 months to 22 months.

Only one region in the UK, the North East, has seen average rents fall over the past 12 months, and apart fom London, Wales has seen the most dramatic increase in rents, rising by 6.5% over the year to £586

John Boyle, Managing Director of HomeLet, said: “Tenants in the Greater London area are stretching their budgets more than ever, not only due to an increase in rental costs, but also rising energy costs following the announcement by utility companies that gas and electricity prices are set to soar even higher.

“Despite having the lowest rents in the country, the level of youth unemployment remains high in the North East, so those traditional first time renters are not entering the market at the rate seen in the last few years. At the other end of the spectrum, older tenants are choosing to rent rather than buy their own property, whilst the average age of tenants is being pushed up by both a reduced number of younger tenants and by an increase in older tenants.”