"Figures point to rents going up"

Here's an interesting read that I've found.

The vacancy rate in Perth has dropped to 1.9 per cent, which should see rents rising at an above-average rate. A vacancy rate of 3 per cent is considered an equilibrium level and our market has been below this level for less than 12 months only.

So with a tight rental market, mainly at the lower end under $750 a week, and a rent-versus-buy gap of around 10 to 20 per cent we would be turning some tenants into first-homebuyers.

This has been evidenced recently by figures from financier AFG that WA has the highest proportion of first-homebuyers in Australia has their clients for loans at a rate of 20.7 per cent of all new loans completed by them.
The upper rental market tends to be extremely fickle, as corporate take a big number of homes for professional staff moving into the State at various stages.
At times there are several tenants chasing one home, at other times there is no demand at all, which creates a market where vacancies and the rent achieved can vary greatly from month to month.
Owners are also responsive as a month’s vacancy can take a long time to make up at a higher rental, that is if it can be let at a higher rental next month.
While people move into the State, mostly chasing work, there appears to be rental demand. Often, uncertainty about the job and family adjustments to the city commits them to rent, not buy. People concerned that future values are going to fall significantly has been the case in other countries, are also committed renters.
Among all of this, we have also seen the number of properties available for sale drop by about 30 per cent over the year, to now be just over 10,000. Like the rental market this is considered to be below an equilibrium level around 13,000 and, like the rental market, this has only occurred recently, being at this level for less than six months.
So a tight rental market, a buying market with a below-average number of properties to choose from suggests a recovery in the property markets in Perth.
The wild card is the call of the end of the boom. Factual or not, it weighs on buyers and market sentiment. Given this, it may be that, in the short term, buyers may keep their money in perceived safety while trade-up buyers stay  put, not wishing to pay hard-earned after-tax dollars into stamp duty to move home. If this is the case, rents will climb and rental yields could go beyond the cost to buy, a phenomenon I have not seen in three market cycles over the last 30 years.
Something has to give from here, either rents or values rising or both.
If you believe whatever is not being measured is being guessed and that numbers and fundamentals start a market cycle and that speculation ends it, then the numbers are telling us the start, the recover, is here and easy to see.
Not everyone will feel optimistic though as cost of living pressures and disparities in earnings in different employment sectors, create a sense of more pain or potential for gain.

This information was gathered from The West Australian. Article by Gavin Hegney.