The average landlord in England and Wales has seen total returns of £21,988 over the past 12 months, new statistics reveal.

Of this amount – and before any deductions such as property maintenance and mortgage payments were taken into consideration – the average capital gain contributed £13,594 while rental income made up £8,394 over the 12 months to January.

The buy to let index from Your Move and Reeds Rains, which takes account of rental income and capital growth, shows that returns have reached 12% in the 12 months to January.

This is up from 11.2% recorded in the 12 months to December and represents a 14-month high from the 12.3% in the year to November 2014.

Rental yields have proven resilient in the face of price rises as the gross yield on a typical rental property in England in Wales now stands at a steady 4.9% in January, the same as that recorded in December 2015.

On an annual basis, this is slightly lower than the 5% gross yield seen a year ago in January 2015.

Rent rises

Average rents across England and Wales accelerated into the New Year, rising 3.6% in January 2016, up from the 3.4% annual rent rises over the 12 months to December.

This puts average rents at £790 per month, as of January 2016.

But on a regional basis, annual rent rises are now led by the East Midlands and East of England, with rents up 5.9% and 5.8% respectively since January 2015. This pushes London to third place, with rents in the capital 5.7% higher on an annual basis, marginally slower than 6.3% in the capital in December.

At the other end of the spectrum rents are lower than a year ago in the South East and North East regions, both seeing a 1.0% annual fall. Meanwhile the slowest annual rent rises are in Wales, up just 0.6% since January 2015.

No bull in the buy to let china shop

Adrian Gill, director of estate agents Reeds Rains and Your Move, said: “Buy-to-let returns are building and property prices are picking up – as the housing shortage across the UK intensifies. Landlords’ balance sheets are looking healthier than at any point since 2014, and property investors are looking at an excellent rate of return from their portfolios.

“Stamp duty premiums on new buy-to-let purchases are the rhino in the room – everyone is talking about the 1st April deadline and the extra purchase costs are perceived by some commentators as potentially hazardous. But this is a little simplistic. Landlords are long-term investors and generally take good advice before making a new purchase, while the real changes will come when some landlords see gradual changes to their tax relief on mortgage interest. The rules around UK property are changing – but there is no bull in the buy-to-let china shop.”