Five Tips for Buying a Home in Palm Springs
Palm Springs Home Buyer Tips
Thinking about buying a home in Palm Springs? The real estate market here is unique, and there are key factors that every buyer should understand before making a purchase. From land ownership differences to short-term rental restrictions, being informed can help you make the best decision for your lifestyle and investment.
As a local real estate broker, I can help you navigate the Palm Springs market. Here are five essential tips to know before buying your dream home.
1. Is the Home on Leased Land or Fee Simple?
One of the most important things to know when buying in Palm Springs is whether the property is on leased land or fee simple land (land you own).
Fee Simple (You Own the Land): This is the most common type of real estate ownership in the U.S. You own both the land and the home outright.
Leased Land (You Rent the Land): Some homes in Palm Springs are built on leased land, which means you own the home, but you pay a lease to the landowner which is typically the Agua Caliente Band of Cahuilla Indians.
Pros of Leased Land Properties:
✔ Homes on leased land tend to be more affordable than similar homes on fee simple land.
✔ Allows buyers to purchase a home in a desirable area at a lower price point.
Cons of Leased Land Properties:
❌ Monthly or yearly land lease fees (can be thousands of dollars).
❌ Financing challenges: Some lenders may hesitate to issue a mortgage if the lease is expiring soon. At a minimum the mortgage must be paid off before the lease expires.
❌ Uncertainty about future lease renewal terms and costs. You land lease can increase substantially if it is renewed.
Tip: Always check the lease expiration date and the annual lease cost before purchasing a home on leased land.
2. Does the Home Have an HOA?
In Palm Springs, many homes—especially in gated communities, are part of a Homeowners Association (HOA). Even some single-family homes fall under HOA rules if they are in gated communities like Miralon or Escena.
Why This Matters:
HOA Fees: Monthly dues can range from under $200 to over $1,000, depending on the community.
Restrictions: Some HOAs limit short-term rentals, exterior modifications, and landscaping.
Amenities & Services: Many HOAs cover community pools, landscaping, and security.
Tip: Always request and review the HOA’s CC&Rs (Covenants, Conditions & Restrictions) before buying. Chances are that you won’t see these documents until you are in escrow. Things to look for are special assessments, the reserves, and if there is any litigation. Even if you don’t look at those factors, if you are getting a mortgage the lender will.
3. Can You Use the Home for Short-Term Rentals?
If you plan to use your home as a vacation rental (Airbnb, VRBO, etc.), be aware that Palm Springs has strict short-term rental regulations.
The city requires a short-term rental permit.
Many neighborhoods have reached their STR limit, meaning you may not be able to get a permit.
HOAs often prohibit short-term rentals entirely.
Tip: If renting your home short-term is part of your plan, check city regulations and HOA rules before purchasing.
4. Are You Buying in a Windy Area?
Wind is a major factor in certain Palm Springs neighborhoods.
North Palm Springs (near I-10 and the windmills) is the windiest area, with gusts often exceeding 40-50 mph in spring.
South Palm Springs is much less windy and tends to have more desirable conditions.
Tip: If you want a quieter, less windy lifestyle, look for homes south of Vista Chino.
5. Understand the New Rules for Real Estate Commissions
In August 2024, major changes to real estate buyer representation agreements took effect.
Buyers must sign agreements with agents before seeing properties (except for the agent’s own listings).
You could be obligated to pay a commission if you sign an agreement without understanding the terms.
Tip: Work with a trusted agent who explains these agreements before you sign anything. Remember that real estate commissions are negotiable, agents will not work for free and either you, the seller, or both could be on the hook for paying the buyer’s agent (technically the broker the agent works for.)
BONUS TIP - INSURANCE
Since the time I did the video linked to this blog post, home owner’s insurance has become such a big issue that it is now a contingency on the California Residential Purchase Agreement (RPA) that is used in most real estate contracts. Even before the fires in the Los Angeles area, many insurance companies stopped writing new policies in California.
If you are buying a condo or townhome in a community, they will almost certainly have a master insurance policy. If you are getting a loan for a condo or townhome, your lender might require you to get a “walls in” policy for the contents and interior of the property. For Single Family Residence, houses, you just get standard fire / homeowner’s insurance.
Thinking of Buying a Home in Palm Springs? Let’s Talk.
Buying in Palm Springs comes with unique considerations, and I’m here to help. Whether you’re looking for a vacation home, investment property, or primary residence, I can guide you through the process. Not local? Not a problem. I have a lot of experience working with remote buyers.
📞 Call / Text: 760.235.1471 or use this contact form.