Since August 2016 – when the base rate was cut from 0.5% to 0.25% – residential property rents have grown by less than 1% (0.94%).

The East Midlands (3.13%), East of England (2.76%), West Midlands (2.53%) and the South West (2.43%) have led the way in terms of rental growth, contributing to the 1.97% increase recorded for the whole of the UK excluding London.

However, research by buy-to-let lender Landbay has suggested that a series of tax and regulatory changes made in the past two years may see costs passed on to tenants if mortgage rates start to increase.

The changes included a rise in stamp duty for second properties in April 2016, the removal of mortgage tax relief from April 2017, and a tightening of lending criteria by the PRA in January and October 2017.

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UK rental index for October 2017

John Goodall, CEO and founder of Landbay, said: “Landlords have had to face a catalogue of challenges over the past couple of years, from stricter regulation, reductions to tax relief and a significant stamp duty tax hike when buying a buy-to-let property.

“Yet despite these pressures, there has been little sign of them passing on these costs to tenants in the form of higher rents.

“Record low mortgage rates have enabled them to absorb some of the costs, especially those that are wary of tenants facing negative net wage growth, so a base rate rise could make all the difference.

“A 0.25% uplift might seem small, but the message it would give to the markets – of monetary policy normalisation – could spook landlords, especially those embarking on long-term tenancies.

“In and of itself, a quarter of a percent is not going to have a huge impact on rental prices overnight, but symbolically it has the power to galvanise landlords to price in many of the tax and regulatory changes that have been building up for some time now.”