Despite news that rents overall are on the rise, it appears many landlords have in fact subsidised good tenants by renting at below market rates, according to a new Allsop report.

Allsop’s latest issue of the Rent Check, a barometer for the rental market in England and Wales, found that of 54 combined data points, 32 lay below RPI and 22 above, revealing annual rent increases were closely tied to the rate of inflation.

The report suggests that rent rises have been relatively moderate due to affordability levels, which have been affected by the rising cost of living and stagnant wage growth over the last decade.

The study also found that rent levels have also been tempered by a high number of landlords letting properties at below market rate to keep good tenants.

Some 59 per cent of landlords surveyed declared they are letting at least one property at below local market levels.

Paul Winstanley, partner at Allsop, said: “Shattering the myth of rent rises greatly outstripping inflation, research has revealed rents have in fact risen moderately at a rate close to RPI over the last five years.

“Landlords have also been prepared to accept lower rents for good tenants. This, and past commitment by landlords to invest in the supply of buy to let property, have helped keep rent rises sustainable.”

So far rent levels have been stabilised by good supply in the private rented sector, which has kept up with the growing demand for rental accommodation.

However, the report warns that a combination of tax and regulatory changes to the sector could have an adverse impact on future supply and result in a significant rise in future rents.

Mr Winstanley added: “Although most landlords are committed to the sector and are not likely to sell-up and leave anytime soon, government policy is likely to make life difficult for them in the longer-term.

"This risks the supply of much needed housing, which can’t be met by the build-to-rent sector and homeownership alone.”