Despite a few ups and downs during the year, the capital's rental market has remained relatively steady during 2012, according to a new study published by lettings agent Aylesford International.

The report shows there has been an increase in enquiries throughout the year for many properties, explains, adding that people show interest for a variety of reasons, including career moves, families wanting to rent before Christmas and those who live elsewhere in the country but want a London base.

Looking back on the year, the rentals market slowed down during February and March, but from April to July, in the run-up to the Olympics, there as a steady increase in activity. In August, things appeared to slow down again.

The study also shows that demand for flats is significantly higher than houses, and that two-bedroom apartments were in the highest demand, followed by four-bedroom homes. In addition, the market for unfurnished properties increased by 69 per cent.

Head of rentals at Aylesford, Catherine Cockcroft, pointed out: "Well presented properties that are realistically priced for the area in which they are located are benefiting from the most activity."

She explained that the sales market is showing a degree of uncertainty, since many buyers are waiting for the government to make a decision on annual tariff and tax changes. "This, coupled with the turmoil and tax increases in some of the European countries makes the UK a more attractive place to live and work, so we anticipate an increase in tenants next year," she added.

Another estate agent, Kinleigh Focklard and Hayward, meanwhile has released figures showing that the lettings market in the capital seems to be improving.

They report that rents have increased by an average of five per cent compared to last year - with the average monthly price currently at £1,538 compared to £1,476 last year. What's more, the average length of tenancy has gone up to 15 months (it was 14 months in 2011).

Regional lettings director James Thornett reckons longer tenancy periods can be advantageous to both landlords, as well as tenants, as it means they can avoid costly vacant periods. Of course, the right landlord insurance can also provide rent guarantee, meaning that an empty flat is less of a burden on your finances while you look for new tenants.