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How is it that warm air is able to hold more water vapour than cold air?
Actually, air does not hold water. Warm air often has more water molecules than cooler air but this is because of the energy level of the water particles. To understand this, we must first understand what air is. Air is filled with stuff! When air is warmed the water molecules in the air are also warmed, giving them more energy. When water molecules have more energy they are less likely to condense (you can learn more about water condensation and the water cycle here). Therefore, warm air, which is filled with highly-energized water molecules, often contains more water molecules than cooler air, which is filled with water molecules that more easily condense and become water.