The growth in wages will be greater than the rise in rents in 2014 as disposable income for tenants in the private rented sector is set to grow for the first whole year since the financial crisis, according to LSL Property Services.

The historically significant cross-over of earnings growth and rent rises could happen as early as April but is more likely to happen in July unless wages rise more rapidly than predicted in central forecasts.

David Brown, commercial director of LSL Property Services, said: “The longest recession in living memory has been banished to the history books. And this year the squeeze on living standards is finally abating. Households have withstood half a decade of bombardment from weak earnings, inflation – and a general spectre of gloom. We’re still some way from the finish line, but for now things can only get better.

“As the economic recovery takes hold, there will be plenty of surprises and stumbling blocks.  But the cost of rented accommodation is growing at a sustainable rate. The last time rents were rising more slowly than wages was four years ago – and that was only due to a rapid dip in rents following the collapse of purchase prices. Today we are in a very different situation. The private rented sector is now powered by waves of investment from landlords and a rejuvenated financial system. Meanwhile every sector of the economy – including construction – appears to be creating jobs.”

Average earnings increased by 1.1% during 2013 whilst rents rose by 1.6% on the same seasonally adjusted basis. In previous years rents had risen by more than double wages as in 2012 rents rose by 3.2% while average regular earnings grew by just 1.3%.

The last time rents rose more slowly than earnings on the same twelve month seasonally adjusted basis was in April 2010, meaning this expected crossover will be the first time regular earnings have outpaced rent rises in at least four years.