Average rent in August across England and Wales reached just £1 behind the all-time record of August 2012.
According to the latest buy-to-let index from LSL Property Services plc, monthly rents in August hit an average of £743, up 0.7% from July.
Over the last year rent has increased by an average of 1.3%.
Most regions saw an increase in rents in August with the South East seeing the highest increase of 2%.
The only two regions that saw a decrease were the North East where rents fell by 0.8% in August, and the East Midlands where they fell 0.3% from July.
As ever London saw the fastest annual increases, with rents up 4.8% in the last year.
This was followed by Wales, where rents are 2.3% higher than twelve months ago.
David Brown, commercial director, LSL Property Services, said: “The summer saw a step-change for first time buyers. Better availability of finance has allowed some households to leave the rental market.
“And rents certainly felt the short-term impact of that. But releasing a blast of that pent-up pressure to buy a home is unlikely to change the long-term trend to renting.
“Although government schemes are helping, buying a first home is still extremely hard on the back of low salary growth. As hundreds of thousands of new households look for homes, it’s increasingly private renting that’s absorbed the pressure.
“Autumn brings the seasonal peak for the rental market, in part due to the spike caused by student renters, and the sheer volume of lettings activity shows demand this year is as strong as ever.”