Bunbury’s vacancy rate was 1.3 per cent in January, followed by Mandurah with a vacancy rate of two per cent.

Local REIWA agent Roslyn Ierace said Bunbury’s low vacancy rates could be attributed to a high number of professionals coming into the area to work for large employers such as Worsley or Watercorp.

"The resource industries play a big role in keeping Bunbury’s vacancy rates quite low because of the demand for rentals from workers attracted to these projects," she said.

Mrs Ierace said Bunbury’s vacancy rates normally ranged from three to five percent, but had remained at current rates for several months.

Mrs Ierace said she had seen an increase in investment buyers in the Bunbury market recently, particularly in suburbs such as Carey Park and Withers.

"Investors are looking for capital growth, rental income and potential for future subdivision, and both these suburbs are zoned for subdivision," she said.

Mrs Ierace said renters in Bunbury could expect a slight increase in rent in 2010.

"Rents have remained fairly constant despite house price increases and decreases", she said.

"The rents don’t break even for investors at this rate."

Mrs Ierace said Bunbury had no problems with rental supply, but could struggle to meet the demand for affordable rentals.

She said the highest demand was still for family rental properties, especially in suburbs such as Dalyellup which offered affordable, low maintenance modern homes.

Mrs Ierace said current rents could be as high as $600 per week for a fully furnished apartment in Marlston Hill.