Market Overview

The Palm Springs vacation rental market experienced a typically calm Q3 in 2025, consistent with seasonal trends. As expected, summer remains the slowest period of the year for the region, and overall performance this quarter was slightly softer compared to the same period in 2024.

Despite the slower pace, the summer months continued to attract families from key drive markets such as Los Angeles and San Diego, drawn to Palm Springs for its signature poolside relaxation. While the city remains renowned for its mid-century architecture and reputation as a premier winter destination, seasonal patterns and broader market dynamics contributed to a more modest Q3 performance.

Traveler demand has increasingly centered around high-quality, professionally managed homes in desirable locations. This was reflected in an increase in July’s Average Daily Rate (ADR), even as occupancy declined—signaling that guests are still willing to pay a premium for elevated experiences. Homes that offered premium amenities, thoughtful design, and exceptional service outperformed the broader market during the quarter.

While Q3 was slower overall, momentum from earlier in the year—particularly the strong festival season in Q2—reinforced the enduring appeal of Palm Springs as a destination for high-profile, well-attended events. Looking ahead, we anticipate a seasonal rebound as we enter fall and winter, when demand traditionally strengthens across the desert region.

Q3 2025 Key Performance Indicators

The Data

This data was sourced from 57 property managers with +/- 1,300 properties, all of which are located within Palm Springs city limits.

Looking Ahead

As we transition into the final quarter of 2025, early indicators suggest a moderate performance ahead for the Palm Springs vacation rental market. Historically, Q4 marks the beginning of the region’s high season, as cooler desert temperatures and a packed events calendar begin to draw more visitors.

Booking pace is expected to gradually improve in late October and into November. This is supported by key seasonal travel periods including Thanksgiving and early winter getaways. While demand may not return to peak post-pandemic highs, we anticipate a steady flow of travelers—particularly from regional drive markets and snowbird demographics—seeking rest and relaxation in well-located, amenity-rich homes.

Properties that are competitively priced and offer premium features such as heated pools, outdoor entertainment areas, and updated interiors are likely to capture a larger share of bookings. Travelers continue to show a preference for professionally managed homes that provide consistency, cleanliness, and convenience.

While macroeconomic factors and travel trends remain fluid, we expect a solid finish to the year, especially for owners positioned to meet the expectations of today’s more selective guests. Continued focus on service quality, targeted marketing, and dynamic pricing will be key to capturing available demand and maximizing revenue opportunities in Q4.

The Palm Springs market remains resilient and valuable for vacation rental owners, particularly those aligned with expert property management. As a trusted local operator, Natural Retreats aids homeowners in optimizing both occupancy and revenue through dynamic pricing, luxury guest services, and attentive care.