Increasing levels of rental stability indicates that the impact of the economic crisis on the private rented sector could be bottoming out, it has been suggested.

According to research by FindaProperty.com, in May month-on-month rental prices stabilised for the first time since August last year.

Rising numbers of "accidental landlords" - homeowners who chose to lease out their property after struggling to sell it for a suitable price - and an increase in the number of people opting to rent, both contributed to the downward trend.

Andrew Smith, head of research at FindaProperty.com, said: "A slowing in the increase of supply and signs that asking rents are beginning to stabilise indicate that we may be close to the bottom of the rental market."

However, asking rents in the flat market continued to fall because supply levels remained high, he added.

Although figures published by Nationwide showed that house prices increased by 1.2 per cent in May, Martin Gahbauer, chief economist at the building society, believes the housing market will continue to be volatile.

"In the current downturn, the combination of rapidly-rising unemployment and tight access to credit implies that the last of the price declines has probably not been seen yet," he said.