Buying an apartment building in Palm Springs

Palm Springs doesn't have the most apartment units in Coachella Valley (Palm Desert has more), but it's got prestige and name recognition. If you're considering buying an apartment property, you could do worse.

The cap rates for Palm Springs range from 5% up. I recently walked through a 1955 property, well-located, and in good condition, for sale for a seven cap. As an investor, I'd look at buying an older property in a good area as a two-step strategy: first, run it as is, and look into rebuilding on its foundation in the future.

Here's the issue with Palm Springs for investing: it's a little unfocussed in its long-term future view. There are two large shopping centers which are vacant. One's being remodeled for a hotel now, and met some local resistance (for good reason). The other's just vacant. 

Since I live here, I think it's a great place. For apartment investing, it's got a good location on a major interstate highway, it's near Los Angeles, and has a reasonably healthy local economy. Detroit, it's not.

Los Angeles Times article