Dundee was the only major city in Scotland to see rents fall in the final three months of last year.
The city is the cheapest in Scotland for tenants, with rents rising over the last year at less than half the annual national growth.
Whereas national rents rose by 7.9%, Dundee saw prices increase by 3.2% during the past 12 months.
The Scotland figure is heavily influenced by strong annual rises in Edinburgh (9.5%), Glasgow (9.4%) and Aberdeen (8%).
The report by letting experts Citylets showed the average monthly rent in Scotland stood at £732 per month, whereas average rents in Dundee registered at £545 per month between October and December.
Dundee estate agents believe the city is a prime location for those seeking a home as well as owners looking to rent their property.
Robert Murray, partner at Lickley Proctor Lettings, of Bell Street, said: “Dundee continues to be an attractive city for investment in the rental market.
“We have found the Dundee market has been ‘ticking along’ nicely with no signs of a drop in inquiries.
“If rentals are fairly set in relation to the standard of property, there have been very few problems in the uptake of available properties.”
The Citylet figures show the DD1 post code is the costliest area to rent a property in Dundee.
A one-bedroom flat in the city centre costs an average of £414, with a two-bedroom flat costing £577.
The cheapest area to rent a property is within the DD3 postcode, incorporating areas such as Kirkton, Strathmartine and Hilltown, where a home would cost £337 and £490 respectively.
The average Dundee time to let stands at 46 days, with only 6% of properties now let within a week. However, nearly half (44%) are let within a month.
Citylets managing director Thomas Ashdown said: “There is a very clear picture in the Scottish private rented sector.
“Large city hotspots are driving up the national averages but the market remains sanguine in just about every town in the country.”