The average cost of renting a home in the UK increased in March 2014 by 0.8% to £824 per month, a rise of 6.5% compared to the previous year and the biggest rise since March 2011 according to Homelet.

In Greater London average rents fell by 0.2% from the previous month however they did rise annually by 7.3%. Compared to March 2009 tenants are currently paying 38% more in rent, which equates to an additional £364 per month.

Martin Totty, Chief Executive Officer, said: “When looking at the top 25 areas of rental growth versus the lowest 25 across the whole of the UK, we can see almost half of those in the top sector are within Greater London or the South East – compared to the lowest 25 areas where almost half are northern regions, including Yorkshire and Humberside, the North East and North West.

“Greater London and the South East’s rental markets are growing at a much higher rate than anywhere else in the UK. Therefore although rents are higher, it appears people are being drawn to the capital to take advantage of its job opportunities and lifestyle. Tenants in the south – particularly in the capital – are paying 10% more of their disposable income on rent than they were five years ago.”

A clear north/south divide is opening with rents in the capital now almost three times higher than those in the North East as average rents fell there by 2% monthly and by 16.6% annually to their lowest amount since January 2010 at £492 per month.

Totty said: “Despite increasing rental amounts, more people are choosing to rent a home in the capital. During the past 12 months we’ve seen a 5% increase in the percentage of tenants moving into the Greater London or South East regions from other regions across the UK.

“Therefore it’s not surprising the capital is home to the highest number of tenants per property than anywhere else in the UK. Currently 2.2 tenants live in each rented home in the capital – an increase of 22.7% over the past five years.

“It appears the capital’s thriving economy and job prospects are attracting more people to move to the area. However, the increase in demand will inevitably reduce the supply.

“I believe rents will rise further this year, and with rents in the capital currently just over 95% higher than the rest of the UK (when the Greater London figure is removed), I think it’s only time before this reaches double.”