The proportion of decent homes in the private rented sector has risen from 46 per cent to 74.5 per cent in the last decade, a new report by InterBay Commercial reveals.

In spite of the sector growing by 45 per cent since 2009, adding 1.5m properties, the number of non-decent homes has fallen in absolute terms too; down by 275,000.

As a result, the latest English Housing Survey shows that the vast majority (84 per cent) of private renters were satisfied with their current accommodation.

The study showed that 70 per cent of landlords who have refurbished property did so to improve the quality of their residential investment, with 45 per cent doing so to boost financial returns.

InterBay’s analysis shows that landlords typically spend £12,000 per refurbishment. This varies considerably on the type of refurbishment.

Many landlords take a “little and often” approach to refurbishments, seeking to ensure they maintain rental income and the quality of the property, while a minority seek more significant and costly works to add value or convert a property.

Some 28 per cent of landlords spent less than £5,000 on their last refurbishment, and 43 per cent spent less than £10,000. At the other end of the scale, just 13 per cent spent more than £100,000.

As well as ensuring a property is in a good enough condition to rent, refurbishment typically bolsters a rental property’s value and income potential. 74 per cent of those who undertook a refurbishment said it enhanced the property’s value, and 82 per cent saw monthly rents rise.

The average rent for a refurbished property rose by £81 per month, up by 8 per cent. Even after accounting for those who did not see the value of their property rise, the typical refurbishment added £13,000 to a property’s value, meaning landlords more than make their money back on the capital gains alone.

For those that saw the value of their home rise, often those undertaking larger-scale development, the increase was substantial. These landlords estimated refurbishment boosted the value of their property by 9 per cent, adding around £20,000.

The larger the renovation, the larger the average increase in value too. While a light refurbishment typically adds around £9,000 in value, compared to an outlay of £7,000, a heavy refurbishment, involving a £40,000 spend on average, adds £96,000 to a property’s value.

Darrell Walker, head of sales at InterBay Commercial, said: “It may be an easy target for political point-scoring, but the private rented sector has been a success story since the financial crisis, catering for a growing proportion of the population that either cannot or chooses not to purchase a home.

“As the PRS has grown, it has also professionalised. As it has done so, the standard of accommodation for tenants has improved drastically too.”