Rent rises slowed to their lowest rate in eight months, according to the latest Buy-to-Let Index from the lettings specialists LSL Property Services plc.

In October, the average rent in England and Wales rose by 0.2% to £720 per month, the lowest monthly increase since February. Annual rental inflation also slowed to 4.1%, a decline from 4.3% in September. Despite the slower pace of increase, rents have now risen for nine consecutive months, and stand at a new record high.

On a monthly basis, rents increased the fastest in the South East and the East of England, where they rose by 1.5% and 0.8% respectively compared to September. Rents fell in three regions on a monthly basis, dropping by 1.4% in the North East and the South West, and by 0.8% in Wales.

Over the course of the last year, London’s rents have risen faster than any other region. However, the monthly rate of increase slowed in London, with rents increasing to £1,030 a month, just a 0.1% rise compared to September. As a result, London’s annual increase also slowed in October, falling to 5.7% from 5.8% the previous month. The next biggest annual increases were in the West Midlands and the South East where rents rose 4.6% and 4.4% respectively.

David Brown, commercial director of LSL Property Services, said: “Rents are still heading upwards, but tenants may take comfort from the fact they did not climb at such a blistering pace in October. The recent increases are likely to continue to level out in run up to Christmas - traditionally a slower time for the market. Nevertheless, despite the slower rate of increase, the cost of renting is still rising annually at nearly twice the speed of the average salary and many tenants will need to dedicate a growing portion of their disposable income to the cost of their accommodation over the next year.

“Although buy-to-let lending has picked up steam, which has helped expand the supply of rental properties, it is still a long way from boosting supply by enough to ease competition amongst prospective tenants. With no sustained meaningful increase in lending in light of the ongoing Eurozone crisis, we are unlikely to see a sustained drop in the number of frustrated buyers in the coming year, and underlying demand for limited accommodation will continue to push up rents in the long-term.”