The Domain Group's quarterly State of the Market report, released on Thursday, continues to bear bad news for homeowners, with the median house price down 1.3 per cent to $554,095 and the median unit price down 6.7 per cent to $351,875.

The median price for renting a house is down 2.8 per cent for the quarter to $350 a week, while unit rents have held steady at $300.

Domain Group chief economist Andrew Wilson said despite the bleak outlook, the one good sign could be the reduction in rental stock - an early sign that a struggling market was due to make a comeback.

"For the past year now, we have seen the first green shoots for a market revival, and that's that vacancy rates have fallen quite sharply," Dr Wilson said.

Vacancy rates are down about 1 per cent from last year - with vacant houses down to 3.2 per cent and units down to 3.8 per cent.

"It is a very early signal ??? the vacancy rate is still the highest in the country ??? but it's not as extraordinarily high as it was a year ago," Dr Wilson said.

Real Estate Institute of Western Australia president Hayden Groves said one of the reasons for the higher demand for rentals could be down to migration.

"We've got a lot more people coming into the state again," Mr Groves said. "There's still more people leaving than coming here, but the rate of exodus has significantly reduced in a quarter."

International migration has nearly tripled to 5500 in the quarter between December 2016 and March 2017, according to the Australian Bureau of Statistics. The post-mining boom flock to the east peaked in the December quarter at 3665, coming down to 2860 in March.

Mr Groves said the time was now for investors to get into the market, particularly if they were looking to buy newer units close to the city.

"The older stock that's around built in the '60s and '70s, that's still hard to shift in terms of getting tenants," he said. "But new stock ??? very smart, near the city, near a railway line ??? you can pick them up pretty cheaply now and if you can get a pretty good tenant, they're almost positively geared."

Areas such as Mount Pleasant, Applecross and Ardross are tipped as good spots to pick up a unit, along with the western suburbs, in light of ongoing pressure to increase density, Mr Grove said.

"By getting in early and getting something good quality anywhere in the western suburbs, I think will be quite a good buy long term," he said.

Thought Leaders Real Estate director Matt Travia sells and leases homes from Hillarys to Floreat, and said the coast was doing well in terms of rentals.

"The quality homes in quality locations are still leasing rapidly," Mr Travia said. "We're definitely not reducing rents any more on lease renewals, I think it's found its bottom in that respect."

Acton Real Estate chief executive Travis Coleman said there was still a lot of competition, but investors could do well.

"As long as the price is right on the advertised property, they will lease," Mr Coleman said.

Dr Wilson said first-home buyers continue to be winners in the west, as they did not have to worry about selling in the slow market and could take advantage of five year lows.

"First-home buyers are still quite active in the Perth market because they don't come in with that trading conundrum," he said.

Investors may not be so lucky, however, as banks cracked down on investor lending across the country. Dr Wilson said this could mean an uphill battle to put the market back in black.

"It's going to take quite a concerted period to return to the drive from people which was very much a part of the Perth story through the mining boom," he said.