The actual reality on the ground in what I call the "international real estate markets" where hedge funds, foreigners, and rich locals are actively purchasing expensive properties to have their wealth parked in "stable real estate" is an actual increase in rents. A couple of things are happening: a contraction in inventory. One reason is because some of these people are not renting at all (the house is like an art piece, a safe place to park wealth that you think will increase in value and so you do not need to rent it - or it's okay to lose money short term on it because it's a hedge against a stock market collapse). A corresponding reaction from builders: build high end expensive housing because you make more money selling 1 expensive unit compared to 10 middle class units. But there's a deeper problem: the builders are showing a hesitancy to commit to lots of new inventory- because they don't appear to think that the long-term fundamentals look good (a clear indicator that something not rational is going on). Even if they were gung-ho, it takes 3 years to get serious inventory online.
The market becomes a mania: unusually low inventory of a commodity that people MUST have to survive, coupled with bets being made by people who could increase inventory that the mania won't be there in 3 years.
This is exacerbated by a background of incomes not rising, and a slew of bad credit from the previous housing collapse (meaning renting is required) combined with all-cash wealthy buyers.
And there's even more to it than that.
I really hope people start realizing how problematic the real estate market is when you don't shield it from WEALTHY SPECULATORS. Everyone got excited about the evils of minorities and poor people owning a home, and the lending market has now made it exceedingly difficult for those guys to get in. We are left with what I believe was the root of the problem: people with money to burn whose retirement plan consists of charging people more rent money or re-selling their property to the next Dutch tulip buyer. And government's across the globe have set up tax structures to encourage them to park their money in real estate, indeed made it very lucrative for a person in the tippy-top to make big money on real estate (USA: 500k in profits tax free after two years for your house, plus in some scenarios a 50% discount on your mortgage payment because of tax benefits). You make 40k a year? No discount on your mortgage, after two years your house won't appreciate enough to cover the $6k in expenses it costs in government fees to own it.
And so on and so on.