Is Airbnb still worth it in Cabo San Lucas?

Is Cabo San Lucas still getting enough tourists for Airbnb?

Yes. Cabo San Lucas still attracts more than enough high-spending tourists to support a large Airbnb market.

Los Cabos received close to 3.8 million visitors in 2025, according to the Los Cabos Tourism Board, about 130% more than a decade earlier. Over the same period, hotel inventory grew from around 15,000 rooms in 2016 to more than 22,000.

Demand absorbed most of that extra supply. Hotels averaged close to 70% occupancy in 2025, with an average daily rate near $440 and revenue per available room around $306. Nearly 80% of hotel rooms are five-star. Visitors here already accept paying a lot for a bed.

That helps short-term rentals, especially larger homes. For a family or a group, a house with several bedrooms, a kitchen and a pool can cost less than three or four luxury hotel rooms.

Los Cabos tourism indicator	Recent level	Longer-term context	What it tells us
Annual visitors (2025)	~3.8 million	~130% growth over a decade	Large tourism base
Hotel rooms	22,000+	~15,000 in 2016	Supply has expanded heavily
Hotel occupancy (2025)	~70%	Still high despite new rooms	Demand has absorbed much of the growth
Hotel ADR (2025)	~$440	Premium destination pricing	Visitors tolerate expensive accommodation
Five-star share of hotel rooms	~80%	Luxury-heavy market	Cabo attracts high-spending guests

Are fewer tourists flying to Cabo in 2026?

Yes. Tourism is still big, but airport traffic has been falling all year, and international travelers are dropping fastest.

Grupo Aeroportuario del Pacífico (GAP) counted 5.35 million passengers at Los Cabos airport from January to September 2026, down 5.6% from 5.67 million a year earlier. International passengers fell 8.4%, from 3.50 million to 3.21 million. Domestic traffic slipped 1.2%.

It hasn't bottomed out yet. In September 2026, international passengers were down 14.7% and total traffic 7.5%.

This doesn't make Cabo a weak destination. But automatic tourism growth has to come out of your numbers. Current demand is enough; any future growth is a bonus.

Los Cabos airport passengers	Jan–Sep 2025	Jan–Sep 2026	Change
International	3.50M	3.21M	-8.4%
Domestic	2.17M	2.15M	-1.2%
Total	5.67M	5.35M	-5.6%
September 2026, international	—	—	-14.7% YoY
September 2026, total	—	—	-7.5% YoY

How much does a Cabo San Lucas Airbnb actually make today?

Somewhere between about $29,700 and $84,100 a year on average, depending on which data provider you believe. That gap is the first thing to understand.

AirROI tracks 2,894 active listings in Cabo San Lucas over the 12 months to September 2026. It puts average annual revenue at about MXN 552,000 (around $29,700), average occupancy at 32.5%, an average daily rate of about $393 and revenue per available night (RevPAR) of about $121. Average revenue is down 3.3% over a year.

AirDNA's October 2026 data counts 2,434 active rentals, with average annual revenue of about $84,100, 48% occupancy and an average nightly rate of $567.

The two can't both describe the same typical property. They use different boundaries, different rules for what counts as an active listing, and different property mixes. AirDNA's count of active listings also dropped about 72% in a year while AirROI's rose 27%, which tells you more about methods than about the market.

For an actual purchase, ignore the citywide average. Compare against listings with the same bedroom count, neighborhood, view, amenities, guest capacity and price tier. Anything broader can make a mediocre condo look much better than it is.

STR dataset (Cabo San Lucas)	Listings	Occupancy	ADR	Annual revenue
AirROI (12 months to Sep 2026)	2,894	32.5%	~$393	~$29,700
AirDNA (Oct 2026)	2,434	48%	$567	~$84,100

Are Cabo Airbnb nightly rates falling in 2026?

Yes. Hosts are cutting prices to keep their calendars full: AirDNA shows the average nightly rate down 15.0% over a year, to $567, while occupancy rose 11.9%.

The net effect is roughly flat. Revenue per available night is $273, up only 1.5%. Hosts are working harder (more check-ins, more cleaning, more wear) for about the same money.

That fits the airport numbers. With fewer international travelers arriving and plenty of listings to choose from, guests have more bargaining power, and generic condos feel it first.

What to do: when a seller or agent shows you an income statement, ask for the nightly rates and occupancy month by month for 2025 and 2026, not just a yearly total. If 2026 rates are well below 2025, use the 2026 figures. And never accept a projection built on last year's peak prices.

Are Cabo's best Airbnbs making the average look misleadingly good?

Yes. The gap between ordinary and exceptional Airbnbs in Cabo San Lucas is so wide that an average tells you very little.

AirROI puts median monthly revenue at about MXN 32,900 (around $1,770). The bottom quarter earns under about $740 a month. At the other end, the top quarter starts around $4,030 and the top 10% above $10,500.

Occupancy spreads almost as widely. The median listing sits around 32%, the top quarter reaches at least 53% and the top 10% above 73%.

RevPAR shows it best. The median is about $58. The top quarter reaches at least $119, the top 10% about $292, roughly five times the median.

Luxury villas stretch the numbers further. Cabo's top listings include five-, six- and seven-bedroom villas with private pools, staff and chefs. They belong in the same dataset, but they say nothing about what a normal two-bedroom condo will earn. A $500,000 condo and a staffed $5 million villa share a destination and almost nothing else.

AirROI performance tier	Monthly revenue	Occupancy	ADR	RevPAR
Bottom 25%	~$740	~17%	~$97	~$29
Median	~$1,770	~32%	~$178	~$58
Top 25%	$4,030+	53%+	$388+	$119+
Top 10%	$10,500+	73%+	$855+	$292+

Is Cabo San Lucas already too crowded with Airbnbs?

For generic one- and two-bedroom condos, yes. There is enough competition to punish anything ordinary.

About 84% of AirROI's 2,894 Cabo San Lucas listings are entire homes, and apartments or condos make up about 62% of the market.

Two-bedroom units are the biggest group, at 38% of entire homes with a known bedroom count. Add one-bedrooms (18%) and studios (6%) and the smaller units make up about 62% of supply.

That's where it gets uncomfortable. A guest looking for a two-bedroom condo can often compare several near-identical units in the same building. When pools, kitchens and furniture are similar, price and reviews decide.

Larger homes compete in a smaller pool. About 38% of entire-home listings have three bedrooms or more, and they target groups that would otherwise book several hotel rooms.

We would be most careful with a two-bedroom unit several minutes from the beach, with no real view and no standout amenities. Cabo has plenty of those already.

Is the two-bedroom Cabo condo market oversupplied right now?

Yes. Two-bedroom condos are the clearest case of oversupply in Los Cabos, which gives buyers leverage but makes both renting and reselling harder.

BCS MLS data compiled by Cabo Real Estate Services shows two-bedroom condo sales falling from 737 in 2021 to 720 in 2022, 459 in 2023, 391 in 2024 and 320 in 2025, less than half the 2021 level.

Q3 2026 didn't change the picture. There were 646 two-bedroom condos for sale at the end of the quarter. Only 67 sold, while 175 new listings came on the market. That's about 22 months of supply.

That's the catch for Airbnb investors. An oversupplied market is a good time to buy, because sellers have little leverage. But once you own, you're surrounded by hundreds of similar units, both when you look for guests and when you sell.

A two-bedroom condo can still work in Cabo, but the price has to make up for how easy it is to replace.

Two-bedroom Los Cabos condos	Sales / inventory	What changed
2021 sales	737	Boom-level activity
2022 sales	720	Little slowdown
2023 sales	459	Sharp contraction
2024 sales	391	Demand weakened again
2025 sales	320	Less than half of 2021
Q3 2026 active inventory	646	Heavy supply
Q3 2026 sales / new listings	67 / 175	Supply still growing
Q3 2026 months of inventory	~22 months	Strong buyer leverage

Are Cabo property prices finally getting interesting again?

Yes. Prices and inventory have moved far enough in buyers' favor that the purchase price is now one of the best arguments for a Cabo Airbnb.

Berkshire Hathaway HomeServices Baja reported an average Cabo San Lucas condo sale price of about $437,000 in 2025, down from about $526,000 in 2024, a 17% drop.

The market is still soft. Christie's Real Estate Cabo counted 375 MLS sales in Cabo San Lucas and the Corridor from January to September 2026, 18.1% fewer than a year earlier. In Q3 2026, the Los Cabos condo median fell 8.9% in three months to about $346,000, according to Cabo Real Estate Services.

Supply is heavy across the board. Cabo Real Estate Services puts overall condo inventory at about 24 months of sales. Buyers have time and choice.

That changes the Airbnb math. In a hot market, you overpay before the first guest arrives. Today you can negotiate the cost down instead of hoping strong bookings will rescue an expensive purchase. For the wider market picture, see our analysis of the Cabo San Lucas property market.

What Airbnb yield can a normal Cabo condo realistically produce?

At median revenue, a disappointing one: about 4.9% gross on a $437,000 condo. It only gets interesting when revenue is well above median or the purchase price comes down.

Here is a simple screening calculation. AirROI's median monthly revenue of about $1,770 equals about $21,200 a year. On the 2025 average condo sale price of $437,000, that's about 4.9% gross, before any cost.

If the same condo reaches the top-quartile threshold of about $4,030 a month, annual revenue rises to about $48,300 and gross yield to about 11.1%.

Price matters just as much. Bought at the Q3 2026 condo median of about $346,000, the same median revenue gives about 6.1% gross, and top-quartile revenue about 13.9%.

But top-quartile revenue means beating three out of four Cabo listings. It should never be the base case for an average unit. A safer test: the deal should still look acceptable at median or slightly above-median revenue. If the return depends on joining the top 25% right away, you're betting on execution, not buying a good deal.

Example on a $437K condo	Median revenue	Top-quartile threshold
Monthly revenue	~$1,770	~$4,030
Annual gross revenue	~$21,200	~$48,300
Gross rental yield	~4.9%	~11.1%
Revenue after 25% management	~$15,900	~$36,200
Yield after management only	~3.6%	~8.3%
Same revenue, $346K condo (gross)	~6.1%	~13.9%
HOA, utilities, repairs, insurance and tax	Still excluded	Still excluded

Do Airbnb fees and management wipe out the return in Cabo?

On a mediocre property, yes, and fast.

Full-service vacation-rental management in Los Cabos commonly runs around 20% to 30% of rental revenue. We use 25% as a screening assumption until you see a real contract.

Airbnb takes its share too. Most Mexican listings now use Airbnb's host-only fee of about 16%, where the host pays the whole service fee. The older split fee charges the host about 4% and the guest the rest. Check which one applies to your listing, because it changes your net and how you price.

Take only 25% management off the $21,200 median-revenue example and about $15,900 is left. You still pay HOA dues, electricity, internet, repairs, replacements, insurance, the bank trust (about $550 to $700 a year) and tax. Furnished rentals also wear out faster: luggage, turnover cleaning and constant air-conditioning all cost money.

At about 5% gross, there isn't enough margin to absorb all that. A property starting above 10% gross can survive bad months and normal costs. That's why the starting yield matters so much in Cabo.

Does Cabo's low season make Airbnb income too unstable?

No. Revenue drops in the hot months, but the low season is manageable if the property has enough margin.

AirROI's high season runs from December to March, with average revenue of about $4,830 a month per listing and 45% occupancy. The low season, August to October, averages about $3,310 a month and 32% occupancy.

The best month, March, brings in about $5,230; the weakest, September, about $2,900. That's a drop of roughly 45%.

AirDNA gives Cabo San Lucas a seasonality score of 73 out of 100, where higher means steadier revenue through the year. Cabo has a real low season, but it doesn't shut down.

The mistake is using winter rates and occupancy for all twelve months. Build the summer slowdown into your numbers from the start. Also note September is peak hurricane season, which brings cancellations and sometimes repairs.

Will Cabo's water shortage hurt your Airbnb?

It can. A guest who finds no water in the shower leaves a bad review, and in Cabo San Lucas that risk got real in 2026.

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 water 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) designed to add 250 liters per second, was reported 73% complete, but in June 2026 the local business council said paperwork was holding up construction. In July 2026, the Baja California Sur governor also floated refusing new development permits in Los Cabos unless developers prove they have enough water. It's a proposal, not a law.

What to check before buying a rental: how many days a week the building gets city water, the size of the cistern, whether there is a backup tank, and what the HOA spent on water trucks in 2026. Ask how the building handled the September outage. For a presale, get the developer's water feasibility letter before paying a deposit. And budget for water trucks in your operating costs; they are a real expense in some areas.

Which Cabo Airbnbs still have the best chance of making good money?

The ones that give guests an obvious reason to pick them over dozens of nearby alternatives.

Location is the clearest edge. Walking access to Medano Beach, the marina, restaurants and nightlife means guests don't need taxis or a rental car. A cheaper, badly located condo can't copy that.

Views matter in a market where people buy an experience. A real, unobstructed ocean view carries far more pricing power than "minutes from the beach."

Larger homes have a clear job: three- and four-bedroom properties compete for families and groups who would otherwise need several expensive hotel rooms.

Private pools, big terraces, resort services and good outdoor space push a property further from the generic condo pool. At the top, staffed villas with chefs and housekeeping are effectively small private hotels.

Don't pay a premium for cosmetic differences. Nice furniture and good photos help, but competitors can copy both. Location, view, layout and private amenities are much harder to copy. Reliable water is now on that list too.

How much tax does a Cabo Airbnb pay, and is foreign ownership a problem?

Taxes and the bank trust add cost and paperwork, but neither makes a Cabo Airbnb impractical. The costly mistake is not giving Airbnb a Mexican tax ID.

Cabo lies in Mexico's restricted zone, within 50 kilometers of the coast, so foreign buyers hold residential property through a fideicomiso, a trust with a Mexican bank. The Ministry of Foreign Affairs allows these trusts for up to 50 years, renewable. It's a routine structure in Cabo, not a workaround.

On the rental side, Airbnb collects the 4% Baja California Sur lodging tax from guests, including on the cleaning fee. Short stays can also be subject to 16% VAT. And the platform withholds income tax: 4% of your receipts if you give it a valid Mexican tax ID (RFC), 20% if you don't. That gap alone can turn a thin return into a loss, so get an RFC before your first booking. And if you aren't a Mexican tax resident, budget 25% of gross rent in income tax: about $5,300 a year on the $21,200 median example, which leaves a median-revenue condo with almost nothing once management is paid.

Your final tax bill depends on your residency, registration and structure, so get tax advice as part of due diligence, not after the first booking. We found no Mexico City-style registry or cap on short-term rentals in Los Cabos as of October 2026, but many condo buildings set their own rules: read the HOA bylaws before you buy. For the full list of ownership costs, see our guide to property taxes and fees in Cabo San Lucas.

Closing costs also lower your real return, especially when someone quotes yield on the MLS price alone. One more reason a 5% gross yield looks weak once you move from a spreadsheet to real ownership.

Is Cabo's current buyer's market actually good for Airbnb investors?

Yes. It may be the best part of the Cabo Airbnb case, because you can improve your return before taking any operating risk.

Buyers have far more leverage than during the 2021–2022 rush. Sales are down, condo inventory sits around 24 months, and two-bedroom condos around 22 months.

Use it. Negotiate hard on price, compare several finished units, avoid weak developments, and walk away when realistic rental income doesn't justify the seller's number.

That's much safer than overpaying and assuming better management will somehow add $15,000 or $20,000 of revenue a year. You negotiate the price once; rental income has to be earned again every year.

Spend at least as much time on stale listings, sold comparables and motivated sellers as on Airbnb nightly rates.

When does a Cabo Airbnb deal become a bad investment?

When ordinary rental performance can't carry the purchase price.

The clearest example is a generic one- or two-bedroom condo bought close to asking price in a building full of similar units. At AirROI's median of about $1,770 a month, a $437,000 purchase earns less than 5% gross before the expensive part of owning it even starts.

Second warning sign: a model that needs 50% or 60% occupancy from day one. Median occupancy is about 32%; 53% already puts you in the top quarter.

Third: a deal that needs strong price growth to make up for weak rental income. Cabo condo prices have just shown they can fall while tourism stays healthy.

Fourth, new in 2026: a building with no clear answer on water supply.

The test is simple. Run the property with conservative comparables, normal costs, 2026 nightly rates and little or no appreciation. If it still looks good, there may be a deal. If it only works after raising occupancy, nightly rates and resale value all at once, you're taking too much on faith.

So, is Airbnb still worth it in Cabo San Lucas?

Yes, selectively. An average condo at an average price is no longer a convincing Airbnb investment.

Demand is still there: close to 3.8 million visitors in 2025, around 70% hotel occupancy and hotel rates around $440. But airport traffic is down 5.6% this year, and nightly rates are down 15.0%.

The data providers disagree on averages, but AirROI's tiers show what matters: median listings make about $1,770 a month, the top quarter starts at about $4,030. Those are two different businesses.

Meanwhile, the resale market has turned toward buyers. Condo prices fell, sales are down and inventory is heavy. That's a better entry point than a few years ago, if you actually use your bargaining power.

Our cutoff is strict. A generic condo producing about 5% gross is hard to justify once management, HOA, utilities, maintenance, insurance and tax are in. A property bought at a discount, with reliable water and a real reason for guests to choose it, that can get close to double-digit gross yield is much more compelling.

The money in Cabo now comes from buying well and owning something guests want, not from betting that tourism will keep lifting every rental.