Average rents across England and Wales have risen at twice the annual rate of weekly earnings to £753 per month according to LSL Property Services.

Rents rose by 1.6% in the 12 months to November 2013 compared to 0.8% annual growth in weekly earnings, with average regular pay before tax standing at £1941 per month according to the Office for National Statistics.

David Brown, commercial director of LSL, said: “Economic reality now resembles the most optimistic dreams of last year.  But for so many households, the dream of homeownership is still relegated to the imagination.

“It’s not just wages. Savings rates have been swamped by inflation for half a decade – so building up even a 5% deposit is a real struggle. Help to Buy is having a perceptible impact, with thousands of first time buyers benefiting already. Yet millions of new households have joined the queue at the bottom of the housing ladder – and private renting is the only tenure to have taken up much slack.”

Rents across England and Wales remain significantly higher than a year ago, despite a recent seasonal drop of 0.7% (or approximately £5) in the month since October 2013.

November 2013 also witnessed annual growth in lettings activity with the number of new tenancies agreed across England and Wales rising by 1.5% compared to November 2012, despite a slowdown on a monthly basis, with 6.3% fewer new lettings than in October 2013.