The average cost of renting a property in Britain has fallen for the first time since the financial crisis and London has seen the biggest decline, a new report has shown.

According to data released on Tuesday (6 June) by HomeLet, which provides services to landlords and letting agents, the average monthly rent of a tenancy agreement starting in May stood at £901, a 0.3% year-on-year decline.

The drop is the first decrease on record since December 2009.

The pace of decline in London, however, was much steeper than in the rest of the country, as rents in the capital fell by 3% from the corresponding period last year to £1,502. Meanwhile, the North-East of England, the South-East, Yorkshire & Humberside, and Scotland registered falls ranging from 2.3% to 0.6%.

"Rental data suggests landlords are now facing a difficult balancing act between ensuring rents are affordable for tenants in a low real wage growth environment whilst covering their own rising costs," said HomeLet's chief executive, Martin Totty

"Tenants will still need a vibrant and growing rented sector to provide them with property options at the time of their choosing."

In March, letting agency Countrywide reported the cost of renting a property in Britain had declined for the first time in six years, thanks a drop in London and the South East of England. Experts said lower rents in London are due to the fact that a number of tenants are looking to move away from the capital.

Last week, Nationwide said UK house prices fell for the third straight month in May, suggesting that the housing market is losing momentum.

According to the building society, house prices fell a seasonally-adjusted 0.2% from a month earlier following a 0.4% decline in April. Analysts had expected prices to drop by 0.1%.

The figure marked the first time house prices have fallen for three consecutive months since 2009.

While the average price of a home was still 2.1% higher compared to May of last year at £208,711, but the pace of growth was considerably slower than the 2.6% expansion recorded in April.