West Coast6.6% avg cap rate

Palm Springs, CA

Coachella Valley desert luxury — celebrity homes and festival demand

Palm Springs and the Coachella Valley are among the highest-ADR STR markets in California outside of Napa and the Hamptons-equivalent Malibu. The Mid-Century Modern architecture, private pools, and proximity to Coachella/Stagecoach create a unique market that delivers extreme ADR spikes in April and strong snowbird demand from October through May. Palm Springs requires a STR permit and a transient occupancy tax remittance.

6.6%
Avg Cap Rate
Net operating income / price
63%
Avg Occupancy
Annual average
$425
Avg Nightly Rate
All property types
$620K
Median Price
STR-viable properties

Estimated Annual Performance

Gross rental revenue
63% occ × $425/night
$97,729
Est. operating expenses
Mgmt, cleaning, supplies, insurance (~40%)
– $39,092
Est. net operating income
Before mortgage & depreciation
$58,637
At median price
Implied cap rate
9.5%

* Estimates based on market averages. Individual property performance varies. Always run a full underwriting analysis.

Why Investors Choose Palm Springs

Coachella and Stagecoach weekends produce highest ADR of any California inland market
Mid-Century Modern architecture drives extraordinary listing photography
Private pool is near-mandatory — adds $150-300/night to base rate
Snowbird season Oct – May provides 7-month high-occupancy window
Peak season: Oct – May (snowbird), Apr (Coachella)
Top property types: Single Family, Mid-Century Modern, Pool Home, Condo
Primary zip: 92262, 92264, 92270, 92260

Market averages, not guarantees. Cap rates, occupancy, and nightly rates are market-wide averages based on active STR listings and historical data. Individual property performance depends on location, amenities, management, and listing quality. Always run a full underwriting analysis before purchasing.

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