Is now a good time to buy in Cabo?

Is Cabo finally a buyer's market?

Yes. Los Cabos is a buyer's market for most resale property, and the condo segment shows it most.

Cabo Real Estate Services counted 1,945 active houses and condos at the end of Q3 2026, about 23 months of inventory: 22 for houses and 24 for condos. Christie's Real Estate Cabo, which covers a wider area, puts condos under $1 million at 23.5 months.

The number of listings came down from a record 2,320 in Q1 and 2,134 in Q2, but that isn't buyers clearing stock. Sales fell faster, and 286 listings expired in Q3, more than the 178 that actually sold. Many of those owners will relist.

Q3 2026 was the weakest quarter for Los Cabos since 2020: 178 residential sales worth $133.2 million, against 279 sales and $409.8 million in Q2. Only about 37 properties sell for every 100 new listings.

For anyone who remembers 2021 and 2022, the contrast is big. Today you can compare several similar units, walk away from an unrealistic seller and come back later.

Cabo market measure	Earlier level	Latest level (Q3 2026)	What changed
Active houses + condos	1,493 entering 2024	1,945 (record 2,320 in Q1)	Much more choice
Months of inventory, houses + condos	~15 (Q2 2026)	~23	Sales fell faster than listings
Months of inventory, condos	~16 (Q2 2026)	~24	Softer than houses
Condos under $1M (Christie's)	25.8 months (H1 2026)	23.5 months (Jan–Sep 2026)	Still very heavy supply
Sales per 100 new listings	42 (Q2 2026)	37	Listings outrun sales
Expired listings vs sales	—	286 vs 178	More owners give up than sell

Are Cabo property prices actually falling now?

For ordinary condos, a little. For expensive condos, no. Cabo hasn't crashed; it has split by product.

Christie's January to September 2026 figures show condos under $1 million averaging about $399,000, down 5.1%, on 15.9% fewer sales. Homes under $1 million barely moved, at about $403,000 (-0.5%). Condos above $1 million averaged about $2.68 million, up 24.2%.

The condo median, which a few trophy deals can't distort, was $346,356 in Q3, down 8.9% from Q2, according to Cabo Real Estate Services. The average sale fell 49.1% to $748,306 in the same quarter, simply because no $10 million home traded.

Asking prices sit above all this. TuLugar's October 2026 listings put the median condo asking price across Los Cabos at $371,000, and about $3,071 per square meter.

So "are Cabo prices up or down?" is too broad. Check the price band and the building before reading any headline.

How much can buyers negotiate on a Cabo property today?

Enough that paying full asking price on a listing that has sat for months needs a very good reason. Opening 5% to 8% below asking is reasonable on an ordinary condo or house.

Cabo Real Estate Services counted 1,295 price reductions on completed houses and condos from January to September 2026, after 1,193 in all of 2024 and 1,640 in 2025. Only 19% of the 2026 cuts led to a sale, against 34% in 2025. A small cut on an overpriced listing doesn't move buyers anymore.

Closing prices confirm it. Q3 sales closed at 93.2% of original asking: 92.5% for houses and 93.6% for condos. MLS data compiled by a RE/MAX agent puts condos at 93.8% of original asking over the 12 months to September 2026. On a $500,000 condo, 93.2% means about $466,000.

What to do: ask for the date the property first listed, every price change and whether it has expired and relisted. With 286 listings expiring in Q3, a relisted unit is often the one where the owner will finally talk. Then compare with MLS sold prices from the last six months in the same building, not with asking prices.

Are there simply too many two-bedroom condos in Cabo?

Yes. Two-bedroom condos are the most oversupplied part of the Cabo market.

Cabo Real Estate Services counted 646 two-bedroom condos for sale at the end of Q3 2026, about 22 months of supply. Only 67 sold in the quarter, against 175 new listings.

The history explains it. Two-bedroom sales hit 737 in 2021 and 720 in 2022, developers launched projects to match, then sales fell to 459 in 2023, 391 in 2024 and 320 in 2025, just as those projects were finished. With 276 sold so far in 2026, this year will probably end close to 2025, not far above it.

Many presale buyers from the boom are now getting their keys and reselling right next to the developer's remaining units. That's a market where sellers compete with each other.

This is where to be toughest on price. A two-bedroom condo has to win on something concrete: a better view, a better-run building, a lower HOA fee, a real rental history, or simply a lower price.

Year	Two-bedroom condo sales	Change
2021	737	Boom level
2022	720	-2%
2023	459	-36%
2024	391	-15%
2025	320	-18%
2026 (January to September)	276	Similar pace to 2025
Standing inventory (end of Q3 2026)	646 units	~22 months of supply

Is Cabo's luxury real estate market weakening too?

Partly. Luxury condos are doing well, luxury homes less so, and the very top is lumpy.

Q2 2026 showed what the top can do: eight residential sales above $10 million, worth $141.6 million, about a third of the quarter's volume. Q3 had none, and the $2 million to $5 million band fell from 26 sales to 7.

Over nine months, Christie's counted 124 home sales above $1 million, down 19.0%, with 26.3 months of supply. Condos above $1 million held their sales and rose 24.2% in average price.

The MLS also misses much of the top end. Christie's estimates more than $400 million of 2026 developer, presale and branded-residence sales outside the MLS, in places like Chileno Bay, The Cove Club and Maravilla. That's a broker's estimate, not an audited figure.

For a buyer, "Cabo luxury" is too broad to price anything. Scarce oceanfront homes in Palmilla or Chileno Bay, branded residences and ordinary expensive condos now live in separate markets.

Is Cabo tourism still strong enough to support real estate prices?

Yes for now, but 2026 is the first year in a while where the numbers go the wrong way.

The Los Cabos Tourism Board says the destination had close to 3.8 million visitors in 2025, with more than 22,000 hotel rooms, nearly 80% of them five-star. Hotels ran around 70% full at an average rate close to $440 a night, and about 40% of visitors come back.

2026 is softer. Los Cabos airport handled 5.35 million passengers from January to September, 5.6% fewer than a year earlier. International passengers fell 8.4%, and 14.7% in September alone.

That matters because many US and Canadian buyers first discover Cabo as tourists. One weak year won't break the market, but it won't help clear two years of resale stock either. If international traffic keeps falling through 2027, we'd get more cautious.

Cabo tourism indicator	Latest reading	Comparison
Visitors in 2025	~3.8 million	Large tourism base
Hotel rooms	22,000+	~80% five-star
Hotel occupancy (2025)	~70%	Average rate ~$440
Repeat visitors	~40%	Strong loyalty
Airport passengers, Jan–Sep 2026	5.35M	-5.6% YoY
International passengers, Jan–Sep 2026	3.21M	-8.4% YoY
International passengers, September 2026	—	-14.7% YoY

Is Airbnb still a good reason to buy a Cabo condo?

Only at the right price. Buying a generic condo because "Cabo rents well" is hard to justify today.

AirDNA puts Cabo San Lucas at 48% occupancy over the year to September 2026, with an average nightly rate of about $567 and about $84,100 of revenue per active listing. Occupancy is up on a year earlier, but nightly rates fell about 15%: hosts fill more nights for less money.

The data providers don't agree. AirROI, which counts listings differently, puts average occupancy around 32.5% and revenue around $29,700 a year. Neither number tells you what one condo will earn.

Costs then take a big share: management (often around 25% of revenue), HOA fees, utilities, cleaning, repairs, furnishing and empty weeks. On top of that, a non-resident landlord owes 25% of gross rent in Mexican income tax.

What to do: ask for 12 months of real booking statements from the seller, compare with listings in the same building with the same bedroom count, and make sure the deal works at median occupancy. If it needs 50% from day one, walk away.

Could Cabo's water problems make buying risky?

Yes. Water is the most concrete new risk in Cabo in 2026, and it's a building-by-building question.

On September 1, 2026, a ruptured seawater intake shut down Cabo San Lucas' first desalination plant. Later that month, the water utility OOMSAPAS put neighborhoods such as Las Palmas, Lomas del Valle and Los Cangrejos II on an emergency rotation, with trucks filling the gaps. CONAGUA puts the local aquifer's deficit at about 24 million cubic meters a year.

The fix is slow. A second desalination plant, about MXN 1.8 billion (around $96.8 million) of investment, was reported 73% complete, but in June 2026 the local business council said paperwork was holding up construction. On July 17, 2026, the state governor said Los Cabos may refuse new development permits unless developers prove they have water. It's a proposal, not a law.

What to do: ask the seller or HOA how many days a week water arrives, how big the cistern is, whether there are backup pumps and what the building spent on water trucks last year. Two similar condos can deserve different prices if one handled September 2026 much better than the other.

Is resale better than pre-construction in Cabo right now?

For most buyers, yes. With about two years of resale stock, there's little reason to take construction risk unless the discount is real.

During the 2021–2022 rush, buyers took presales because finished units were scarce. Today, 1,945 houses and condos compete for buyers, and two-bedroom condos alone carry about 22 months of supply.

A resale lets you stand in the unit, check the real view and road noise, read the HOA accounts, test the water setup and look at what the same units have rented and sold for.

Presales do go wrong here. In 2026, Americans sued a Rancho San Lucas developer after paying over $300,000 for homes they say were defective, and a man was charged over a $124,000 presale condo in Cabo that was never built.

If you still buy off-plan: pay into escrow, tie payments to visible progress, get the developer's water feasibility letter, and ask for a price clearly below finished resales in the same area. Otherwise, you're paying extra to wait.

Does financing a Cabo property still make sense?

Rarely for an investor. Borrowing costs are still high, and Cabo rental yields don't cover them.

Banxico's policy rate is on pause at 6.50%, but Mexican banks still advertised mortgages at about 11.31% on average in August 2026, and the average rate actually granted was about 9.99% in June. Those loans are mostly for residents. Foreign buyers usually use cross-border lenders, with dollar loans typically quoted around 7% to 10%, depending on down payment and profile.

At 8.5%, a $350,000 loan costs almost $30,000 of interest in the first year. Add HOA, insurance, management and vacancy, and an ordinary rental yield disappears.

Buying costs make quick flips unattractive too. A foreign buyer should budget about 6% to 9% of the price in closing costs, including the 3% acquisition tax, notary, registry and the bank trust. A local 2026 breakdown puts them at about $20,250 on a $300,000 condo (6.75%).

Cash buyers have the edge: they can use the current seller weakness without paying 8% to 11% interest while they wait.

Is the weaker peso a reason to buy in Cabo now?

Not on its own. Most Cabo homes are priced in dollars, so the peso barely changes the purchase price, but it does change what you pay to own.

The peso was under 17 per dollar in early September 2026 and is about 18.6 today. Anything billed in pesos, like HOA fees, property tax, the acquisition tax, notary fees, utilities and local staff, now costs close to 9% fewer dollars than six weeks ago.

The few sellers who list in pesos have become cheaper for dollar buyers without cutting anything.

What to do: don't count on the rate staying here. If you sign now, fix the price in dollars, and if part of the payment is in pesos, think about converting when you sign rather than waiting for closing. And don't buy a property you'd only like at today's exchange rate.

What new costs should Cabo buyers price in for 2026 and 2027?

Three: a higher acquisition tax, a likely rise in property tax, and possible water rules for new projects.

The acquisition tax (ISABI) has been 3% in Los Cabos since 2025 (it was 2% before), after a fixed deduction of MXN 213,973. On a $400,000 condo (about MXN 7.44 million), that's about MXN 216,800, or around $11,700.

Property tax (predial) is still tiny: 0.115331% of cadastral value for an owner-occupied home, about MXN 11,533 a year on a MXN 10 million value, and roughly double if you rent it out. But Los Cabos has sent new cadastral values to the state congress, and on October 7, 2026, the Chamber of Deputies passed a national cadastre law that pushes towns to update values. It still needs the Senate. Assume predial goes up from 2027.

The bank trust adds its own bill: MXN 21,650 for the foreign ministry permit, about $550 to $800 to open it at the bank, then about $550 to $700 a year. Get the notary's written estimate before you sign an offer, not after.

Is buying property in Cabo safe for foreigners?

Yes, legally. The risk is the property and the seller, not the ownership structure.

Cabo sits inside the 50 km coastal zone, so a foreign individual holds a home through a fideicomiso: a Mexican bank holds title as trustee and you keep the right to use, rent, sell and leave it to heirs. It runs 50 years and can be renewed. Since June 2026, the foreign ministry has 3 business days to issue the permit, down from 5.

The Foreign Investment Law reform the Senate passed on September 30, 2026 is about national-security screening of companies, not homes. Anyone telling you to "buy before the new law" is selling urgency.

The real checks are local: title and liens, permits, condo documents, unpaid HOA fees, special assessments, rental rules and ejido land ("title is coming" is not title). That matters even more in a soft market, where a big discount can hide a building problem.

Where are the best Cabo buying opportunities right now?

Completed, non-trophy property where several sellers are fighting for the same buyer.

The biggest leverage comes from similar units. If five two-bedroom condos in the same development have comparable layouts and views, you can make them compete on price and terms.

Condos under $1 million stand out: about 23.5 months of supply in Christie's data, average prices down 5.1% and sales down 15.9% from January to September 2026. Cabo San Lucas and its Corridor lost 18.1% of their sales over the same period, and the Pacific side 18.5%.

If you want long-term scarcity, pay for what Cabo can't build more of: a swimmable beach, direct oceanfront, an exceptional view or a proven golf community. Brokers put the premium for a real ocean view at 20% to 40%, so make sure it's a real view.

But if the goal is the biggest discount, boring helps. A finished two-bedroom condo surrounded by competing sellers gives you far more room than a one-of-a-kind villa.

Should buyers wait for Cabo prices to fall further?

Don't wait for a Cabo-wide crash: nothing in the data points to one. Do wait rather than overpay for an ordinary property.

Buyers already have what they'd hope for: plenty of stock, long selling times and repeated price cuts. Christie's puts the average time to sell at about 250 days for homes and condos under $1 million, and about 494 days for condos above $1 million.

There's also no mechanism forcing every seller to dump. Many Cabo owners bought in cash, many homes are second homes, and wealthy owners can leave a listing up, or let it expire, until someone meets their price.

So the waiting game is about the property, not the market. A great unit with real scarcity, priced at closed comparables, is worth buying now. One of 20 identical condos whose seller won't move can wait.

What would make a Cabo property a genuinely good buy today?

It should make sense even if prices barely move for several years.

For a resale, compare the price with actual closed sales in the same building or micro-market, and look hardest at listings that have already been cut or expired.

For a rental, use median occupancy, not the best winter months, subtract the full cost stack and the 25% tax on gross rent. With AirDNA showing more nights booked at lower rates, more bookings don't mean more profit.

For personal use, the math can be gentler. You get value from using the home and don't need the top yield, but a five-to-ten-year hold still makes far more sense than a quick resale.

Check the water track record, and want at least one thing that stays rare when the market gets crowded again: a view, beach access, walkability, a hard-to-copy location or low running costs.

If the deal needs fast appreciation, perfect Airbnb occupancy and an easy resale all at once, pass.

Is now actually a good time to buy in Cabo?

Yes, selectively. Buyers looking at mainstream condos have more leverage than at any time since the boom.

The evidence lines up: about 23 months of inventory, the weakest quarter since 2020, two-bedroom sales down four years in a row, condos under $1 million 5.1% cheaper, 1,295 price cuts so far in 2026 and about 250 days to sell under $1 million.

Cabo itself is still in demand: close to 3.8 million visitors in 2025, eight-figure sales in Q2 2026 and new luxury hotels on the way. The 8.4% drop in international air passengers and the September water crisis are the two things to watch.

We'd buy now for a five-to-ten-year hold if the property is finished, priced at or below recent closed sales, affordable without optimistic rent assumptions, and has a solid water setup. Cash or low debt makes the case much stronger.

We'd pass on an interchangeable presale sold at a premium, a heavily leveraged Airbnb bet or any deal that only works if Cabo prices keep rising fast. You no longer need to chase this market, and that's exactly why it's a better time to buy than the boom years.