Rising house prices and rents have given landlords in the east of England the best returns from property outside London, according to a new survey.

Towns in Essex and Hertfordshire have dominated a list of those providing the highest combination of rental income and potential capital growth in the last year, with the top three all bringing returns of more than 25%.

At the top of a list of investor hotspots compiled by the property website Rightmove is Halstead in Essex, where the average asking price for a property increased from £150,078 in the summer of 2014 to £181,695 a year later. Over the same period, the average rent collected would have been £7,837, giving a landlord who bought at the original price a 26.3% return on their investment.

Borehamwood in Hertfordshire came second, providing £13,691 in rent and an increase in asking prices of £56,308 from an original property value of £267,692.

The figures – which do not take into account tax or any other costs related to offering a buy-to-let property – are based on properties listed for sale and rent across England and Wales. Rightmove said average rents had increased by 4.5% outside Greater London between the third quarter of 2014 and the third quarter of 2015, while in the capital they were up by 3%. However, in the east of England the jump was 6.4%.

Among the top 10 for investors, the only northern town to appear was Cottingham in East Yorkshire, where asking prices increased from £124,216 to £150,211 and rental income added up to £5,936.

Rightmove said six of the areas on the list have asking prices below the national average, meaning they were still affordable to investors. Rents are cheaper than in London and other parts of the south-east, so demand from priced-out tenants is high.

Kevin Mixture, an associate partner of Scott Maddison estate agents in Halstead, said there had been an increase in investors buying in the area as prices were a little lower than in nearby Braintree. “The demand is extremely high and tenants are renting most properties within just a few days,” he said.

Top 10 property investor hotspots

Halstead, Essex: 26.3% return

Borehamwood, Herts: 26.1% return

Brentwood Essex: 25.9% return

Cottingham, Yorks: 25.7%

Purfleet, Essex: 25.1%

Stevenage, Herts: 23.8%

Bushey, Herts: 23.7%

Henley-on-Thames, Oxon: 23.4%

Chatteris, Cambs: 23.2%

Grays, Essex: 22.9%