London had the highest annual percentage change, while the north-east and the south-west of the country saw the lowest.
Renting in the UK has become more expensive and the tenant demand continued to rise in August amid high interest rates.
This is compared to the 5.3 percent in the 12 months to the previous month of July.
The Office of National Statistics (ONS) data recorded the rise in Wales at 6.5 percent, followed by Scotland at 6 percent and England at 5.4 percent.
London had the highest annual percentage change, while the north-east and the south-west of the country saw the lowest, the ONS said.
The latest rental costs reflect the financial struggles, faced by households across the country amid the rising interest rates.
The high cost of borrowing had a significant impact on homeowners, who are often unable to make their increased mortgage payments. Fewer people are looking to buy property, and more turn to renting, which in turn leads to higher demand and a spike in prices.
Whether the BoE decides to increase the bank rate to 5.5 percent or higher will become clear on Thursday, when the Monetary Policy Committee makes the announcement.
Meanwhile, renters in England, excluding London, have to adjust their budgets according to the rental increase of 5.2 percent.
What the Future Holds
The Royal Institution of Chartered Surveyors predicted in their residential market survey that rental prices will continue to increase over the upcoming three months.
The survey, which analysed the lettings market, reported a rise in tenant demand. There was also anecdotal evidence that landlords were leaving the sector because it was easier than making sums stack up with high borrowing costs.
This resulted in an “enduring mismatch between demand and supply,” said the survey.
The agency reported that nearly 70 percent of all landlords have a mortgage or some form of borrowing. Most landlords are on interest-only deals where rate rises are amplified.
“When the interest rate doubles, so do their repayments. Extending the term of the loan makes no difference and often isn’t even an option given the average age of landlords,” said Hamptons.
The agency expects the direction of rents to be primarily set by where the interest rate settles. While high mortgage rates lead to dropping house prices, they have the opposite effect on rents.
The government’s policy is to tackle the high inflation rate and halve it by the end of the year.
“Halving inflation is my top priority because inflation eats into the pounds in your pockets and makes everyone poorer. We’ll stick to the plan and continue to support you with the cost of living,” Prime Minister Rishi Sunak said on Wednesday.
To succeed in its goal, the government needs to bring inflation down to around 5 percent by the end of 2023.