The Index's highlights are:
• Stock of rental properties down ten per cent.
• Rents rise by 0.1 per cent to £830pcm, the sixth consecutive month of stable or rising rents
• Properties let within 58 days, the shortest time since the start of the year
• Long-term landlords who rode out the storm are rewarded with rapidly normalising market
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According to the FindaProperty.com Rental Index for October, the number of rental properties on the market plunged by ten per cent between September and October, following a six per cent fall the previous month, bringing supply back to the level last seen almost a year ago.
An oversupply of flats has been one of the main factors distorting the rental market over recent months, and October saw a significant correction in flat rental stock which fell by 12 per cent. This is likely to be partly due to a seasonal surge in demand from students and graduates requiring lower-cost rental accommodation.
In addition, a number of agents such as Marsh & Parsons and Townends report that the strengthening sales market, which saw prices rise by 0.7 per cent this month, is now attracting a rush of sellers who have been temporarily renting their properties as they wait for house prices to recover.
Rents climbed by 0.1 per cent this month to £830, continuing the clear trend of recovery since April as competition increases among tenants seeking homes to rent.
This increased demand is also reflected in the number of days properties are taking to let, which now stands at just 58 days compared to 71 days at the start of the year.
Michael O'Flynn, Director at FindaProperty.com, said: "Buy-to-let landlords have had a tough time over the last eighteen months, but those who have managed to hang on in the rental market, despite a dramatic oversupply of properties, falling rents and rising unemployment among tenants, are now breathing a sigh of relief.
"Despite the fact that the economy remains uncertain and unemployment is still rising, the oversupply of rental properties is correcting itself almost as quickly as it occurred, and as long as the sales market continues to strengthen this clear out of stock is likely to continue.
"Rents are on a clear road to recovery with six consecutive months of stable or rising prices. Provided the 'double dip' theory of a second fall in sales prices doesn't come to fruition, landlords could be set to enjoy a further recovery in rents over the coming months."
Read the full FindaProperty.com Rental Index.
