Single Family Home prices plummet -- what does that mean for apartment properties?

The Desert Sun reports that prices of single family homes sold in Coachella Valley declined:

http://www.desertsun.com/story/money/real-estate/2014/07/28/coachella-valley-home-prices-dip-june/13257669/

I follow economic reporting, and recall that I have never seen a study of prices for apartment properties compared over the long term to home prices.

Here's my guess: there's no connection. Sometimes, the supply of homes and the supply of apartment units vary. Sometimes, the demand for homes and the demand for apartment units vary. Interest rates vary. Demographic patterns change over time, so some people only want an apartment and some people only want a home.

Cap rates for apartment buildings are about where they were in 2003

According to Multihousing News, recent data shows that capitalization rates are about where they were in 2003.

(All right, students, what are "cap rates"? Answer: the annual "net operating income" of a property divided by its market value, expressed in a percentage.)


http://www.multihousingnews.com/market-data/california-market-report-may-2014-additional-california-markets/1004100418.html


However, interest rates are much better: according to Freddie Mac, interest rates in 2003 were about six percent, and in 2014 they're in the low fours.

http://www.freddiemac.com/pmms/pmms30.htm

So why aren't investors snapping up apartment complexes, driving up the prices?