Authored by the expert who managed and guided the team behind the Mexico Property Pack
Yes, the analysis of Cabo San Lucas' property market is included in our pack
Yes, foreigners can legally rent out residential property in Cabo San Lucas, but the ownership structure and tax setup require some specific steps that are unique to this coastal Mexican destination.
This guide covers everything you need to know about rental strategies, yields, regulations, and neighborhood performance in Cabo San Lucas as of early 2026.
We constantly update this blog post to reflect the latest data and regulatory changes in the Cabo San Lucas rental market.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Cabo San Lucas.
Insights
- Short-term rentals in Cabo San Lucas average around 50% to 55% occupancy annually, but this masks a huge seasonal swing where winter months can hit 80% while late summer drops below 40%.
- Foreigners in Cabo San Lucas hold property through a bank trust called fideicomiso, which costs around $500 to $700 per year in renewal fees and adds a layer of cost that most buyers forget to budget.
- HOA fees in Cabo San Lucas resort-style condos can reach $400 to $650 monthly, which often eats more into net yield than property taxes do.
- The El Tezal neighborhood in Cabo San Lucas consistently offers better gross yields than beachfront areas because entry prices are 30% to 40% lower while rents remain competitive.
- Air conditioning costs in Cabo San Lucas can add $150 to $300 monthly to your expenses during summer months, making utility management a real factor in net profitability.
- Cabo San Lucas hotel occupancy reached 78% in April 2025, signaling strong tourism demand that directly supports short-term rental pricing power.
- Long-term rents for a 1-bedroom apartment in Cabo San Lucas typically range from MXN 18,000 to MXN 32,000 monthly, which translates to roughly $900 to $1,600 USD depending on location and furnishing.
- Furnished rentals in Cabo San Lucas rent about 15% to 25% faster than unfurnished units because the tenant base is heavily composed of expats and seasonal residents who want move-in-ready options.
Can I legally rent out a property in Cabo San Lucas as a foreigner right now?
Can a foreigner own-and-rent a residential property in Cabo San Lucas in 2026?
As of early 2026, foreigners can legally own and rent out residential property in Cabo San Lucas, and thousands of non-Mexican investors are already doing exactly that in this popular Baja California Sur destination.
The main ownership structure for foreigners in Cabo San Lucas is the bank trust (called a fideicomiso), which gives you full rights to use, rent, sell, and pass on the property to heirs while complying with Mexico's coastal zone rules.
The key restriction is that Cabo San Lucas sits inside Mexico's "restricted zone" (within 50 kilometers of the coast), so foreigners cannot hold direct title in their personal name and must use this trust structure instead.
If you're not a local, you might want to read our guide to foreign property ownership in Cabo San Lucas.
Do I need residency to rent out in Cabo San Lucas right now?
You generally do not need Mexican residency to rent out a property in Cabo San Lucas, and most foreign owners manage their rentals remotely without living in the country.
However, to collect rental income cleanly and reduce unnecessary withholding on platforms like Airbnb, you typically need a Mexican tax ID called an RFC, which you can obtain without being a resident.
A local Mexican bank account is not strictly required, but it makes paying HOA fees, utilities, and local contractors much easier since most recurring expenses in Cabo San Lucas are billed in Mexican pesos.
Managing a rental property in Cabo San Lucas remotely is entirely feasible if you hire a local property manager to handle tenant relations, maintenance, and check-ins.
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What rental strategy makes the most money in Cabo San Lucas in 2026?
Is long-term renting more profitable than short-term in Cabo San Lucas in 2026?
As of early 2026, short-term rentals in Cabo San Lucas typically generate higher gross revenue than long-term rentals, but they also come with significantly higher operating costs and management complexity.
A well-managed short-term rental in Cabo San Lucas can generate around $20,000 to $35,000 USD annually (roughly MXN 350,000 to MXN 610,000 or EUR 18,500 to EUR 32,500), while a comparable long-term rental might bring in $12,000 to $18,000 USD per year (roughly MXN 210,000 to MXN 315,000 or EUR 11,000 to EUR 16,500).
Properties in walkable, beach-adjacent areas like El Medano, the Marina, or Downtown Cabo tend to favor short-term renting because tourist demand is concentrated there and nightly rates can be meaningfully higher than what long-term tenants will pay.
What's the average gross rental yield in Cabo San Lucas in 2026?
As of early 2026, the average gross rental yield for residential properties in Cabo San Lucas ranges from about 5% to 8%, depending on whether you pursue a long-term or short-term strategy.
Most residential properties in Cabo San Lucas fall within a gross yield range of 5% to 7% for long-term rentals and 7% to 9% for well-managed short-term rentals, with exceptional units occasionally exceeding these numbers.
Smaller units like studios and 1-bedroom apartments typically achieve the highest gross yields in Cabo San Lucas because they have lower purchase prices relative to the rent they command from tourists and seasonal residents.
By the way, we have much more granular data about rental yields in our property pack about Cabo San Lucas.
What's the realistic net rental yield after costs in Cabo San Lucas in 2026?
As of early 2026, realistic net rental yields in Cabo San Lucas typically fall between 3.5% and 5.5% for long-term rentals and 3% to 6% for short-term rentals after accounting for all operating costs.
Most landlords in Cabo San Lucas experience net yields in the range of 3% to 5.5%, with the wide variation driven by property type, management fees, and how well they control utility costs.
The three main cost categories that reduce gross yield to net yield in Cabo San Lucas are high HOA fees in resort-style condos (often $300 to $650 monthly), air conditioning electricity during hot months, and property management fees that run 15% to 25% of revenue for short-term rentals.
You might want to check our latest analysis about gross and net rental yields in Cabo San Lucas.
What monthly rent can I get in Cabo San Lucas in 2026?
As of early 2026, typical monthly rents for long-term rentals in Cabo San Lucas are around MXN 16,000 to MXN 24,000 ($800 to $1,200 USD or EUR 740 to EUR 1,100) for a studio, MXN 20,000 to MXN 32,000 ($1,000 to $1,600 USD or EUR 920 to EUR 1,480) for a 1-bedroom, and MXN 30,000 to MXN 48,000 ($1,500 to $2,400 USD or EUR 1,390 to EUR 2,220) for a 2-bedroom apartment.
A realistic entry-level monthly rent for a decent studio in Cabo San Lucas starts around MXN 15,000 to MXN 20,000 ($750 to $1,000 USD or EUR 695 to EUR 925) in neighborhoods like El Tezal or Centro.
A typical 1-bedroom apartment in a mid-range Cabo San Lucas location rents for about MXN 22,000 to MXN 30,000 monthly ($1,100 to $1,500 USD or EUR 1,020 to EUR 1,390).
A standard 2-bedroom apartment in a desirable Cabo San Lucas neighborhood commands MXN 35,000 to MXN 50,000 monthly ($1,750 to $2,500 USD or EUR 1,620 to EUR 2,315), with marina-adjacent and beachfront units at the higher end.
If you want to know more about this topic, you can read our guide about rents and rental incomes in Cabo San Lucas.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Mexico versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
What are the real numbers I should budget for renting out in Cabo San Lucas in 2026?
What's the total "all-in" monthly cost to hold a rental in Cabo San Lucas in 2026?
As of early 2026, the total "all-in" monthly cost to hold and maintain a typical rental property in Cabo San Lucas ranges from about MXN 8,000 to MXN 20,000 ($400 to $1,000 USD or EUR 370 to EUR 925), depending on property type and amenities.
A realistic low-to-high monthly cost range for most standard rental properties in Cabo San Lucas is MXN 6,000 to MXN 18,000 ($300 to $900 USD or EUR 280 to EUR 830) for fixed holding costs alone, before factoring in variable costs like repairs and management fees.
The single largest contributor to monthly holding costs in Cabo San Lucas is typically the HOA fee, which can run $200 to $650 USD monthly in resort-style condo communities with pools, security, and shared amenities.
You want to go into more details? Check our list of property taxes and fees you have to pay when buying a property in Cabo San Lucas.
What's the typical vacancy rate in Cabo San Lucas in 2026?
As of early 2026, the typical vacancy rate for long-term rentals in Cabo San Lucas is around 8% to 10%, meaning landlords should realistically budget for about one month of vacancy per year.
Landlords in Cabo San Lucas should budget for 1 to 1.5 months of vacancy annually because the tenant pool, while strong, includes many seasonal residents and expats who may have specific move-in timing needs.
The main factor that causes vacancy rates to vary across Cabo San Lucas neighborhoods is walkability and proximity to the beach, marina, or downtown, with prime locations filling faster than peripheral areas.
The highest tenant turnover and vacancy in Cabo San Lucas typically occurs in late summer (August and September) because seasonal residents leave after winter, and hurricane season makes this period less attractive for new arrivals.
We have a whole part covering the best rental strategies in our pack about buying a property in Cabo San Lucas.
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Where do rentals perform best in Cabo San Lucas in 2026?
Which neighborhoods have the highest long-term demand in Cabo San Lucas in 2026?
As of early 2026, the top three neighborhoods with the highest overall long-term rental demand in Cabo San Lucas are El Medano (including the adjacent Downtown/Centro area), the Marina district, and El Tezal.
Families looking for long-term rentals in Cabo San Lucas tend to favor El Tezal, Cabo Bello, and the Country Club area because these neighborhoods offer more space, quieter streets, and practical access to schools and supermarkets.
Cabo San Lucas is not a traditional student city, but the closest equivalent demand comes from seasonal workers and younger service-sector renters who prefer affordable options in Downtown/Centro and the value pockets of El Tezal.
Expats and international professionals in Cabo San Lucas gravitate toward Pedregal for its premium security and views, El Medano for walkable lifestyle, and El Tezal for newer condos at better value.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Cabo San Lucas.
Which neighborhoods have the best yield in Cabo San Lucas in 2026?
As of early 2026, the top three neighborhoods with the best rental yield in Cabo San Lucas are El Tezal, Centro/Downtown, and Cabo Bello, all of which offer strong tenant demand at lower entry prices than beachfront areas.
The estimated gross rental yield range for these top-yielding neighborhoods in Cabo San Lucas is typically 6% to 9%, compared to 4% to 6% in premium-priced areas like Pedregal.
The main characteristic that allows these neighborhoods to achieve higher yields is that purchase prices have not yet caught up to their rental demand, creating a favorable price-to-rent ratio that more established luxury areas have already priced in.
We cover a lot of neighborhoods and provide a lot of updated data in our pack about real estate in Cabo San Lucas.
Where do tenants pay the highest rents in Cabo San Lucas in 2026?
As of early 2026, the top three neighborhoods where tenants pay the highest rents in Cabo San Lucas are Pedregal, the beachfront pockets of El Medano, and the Marina-adjacent premium buildings.
A typical monthly rent for a standard apartment in these premium Cabo San Lucas neighborhoods ranges from MXN 40,000 to MXN 80,000 ($2,000 to $4,000 USD or EUR 1,850 to EUR 3,700), with luxury villas going significantly higher.
The main characteristic that makes these neighborhoods command the highest rents is a combination of ocean views, gated security, and immediate access to the beach or marina lifestyle that defines the Cabo San Lucas experience.
The typical tenant profile in these highest-rent Cabo San Lucas neighborhoods includes high-income American and Canadian retirees, remote-working executives, and seasonal residents who split their time between Cabo and their home country.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Mexico. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
What do tenants actually want in Cabo San Lucas in 2026?
What features increase rent the most in Cabo San Lucas in 2026?
As of early 2026, the top three property features that increase monthly rent the most in Cabo San Lucas are reliable air conditioning with good insulation, strong high-speed internet (increasingly Starlink in some areas), and a private or shared pool with outdoor living space.
Reliable A/C and good insulation can add a rent premium of 10% to 20% in Cabo San Lucas because tenants and guests know that summer temperatures make cooling a necessity, not a luxury.
One commonly overrated feature that landlords invest in but tenants do not pay much extra for in Cabo San Lucas is ultra-high-end kitchen finishes, since most renters prioritize outdoor space and cooling over gourmet cooking setups.
One affordable upgrade that provides a strong return on investment for landlords in Cabo San Lucas is upgrading to energy-efficient A/C units and adding blackout curtains, which reduces electricity costs for tenants and makes the unit more attractive without major renovation.
Do furnished rentals rent faster in Cabo San Lucas in 2026?
As of early 2026, furnished apartments in Cabo San Lucas typically rent 2 to 4 weeks faster than unfurnished units because the tenant pool is dominated by expats, seasonal residents, and remote workers who want move-in-ready options.
Furnished apartments in Cabo San Lucas generally command a rent premium of 15% to 25% over unfurnished equivalents, which usually justifies the upfront furnishing investment within the first year or two of renting.
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How regulated is long-term renting in Cabo San Lucas right now?
Can I freely set rent prices in Cabo San Lucas right now?
Landlords in Cabo San Lucas have significant freedom to set initial rent prices, as there is no citywide rent control or cap on what you can charge when signing a new lease.
Rent increases during a tenancy in Cabo San Lucas are generally governed by what is written in your lease contract rather than by strict legal caps, though it is common practice to tie annual increases to inflation or negotiate them directly with the tenant.
What's the standard lease length in Cabo San Lucas right now?
The most common lease length for residential rentals in Cabo San Lucas is 12 months, though 6-month leases are also relatively common for seasonal renters and expats who want flexibility.
There is no strict statutory cap on security deposits in Cabo San Lucas, but market practice is typically 1 month's rent (around MXN 20,000 to MXN 40,000 or $1,000 to $2,000 USD or EUR 925 to EUR 1,850 for a typical apartment), with 2 months sometimes requested for high-end furnished units.
The rules for returning security deposits in Cabo San Lucas are primarily governed by the lease contract itself, with standard practice being to return the deposit within 30 days of move-out minus any documented damages or unpaid bills.
We made this infographic to show you how property prices in Mexico compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
How does short-term renting really work in Cabo San Lucas in 2026?
Is Airbnb legal in Cabo San Lucas right now?
Airbnb and similar short-term rental platforms are generally legal in Cabo San Lucas, but operating legally requires attention to local permits, tax registration, and potentially your building's HOA rules.
You will likely need some form of municipal operating authorization or business license from Los Cabos, and you should confirm the correct permit category with the municipal treasury's licensing procedures.
There is no widely publicized annual night limit or cap on how many days per year you can rent short-term in Cabo San Lucas at the city level, though individual HOA bylaws may impose their own restrictions.
The most common consequence of operating a non-compliant short-term rental in Cabo San Lucas is receiving fines or losing platform listing eligibility, though enforcement intensity varies and HOA-level penalties (like fines or lease termination) can be more immediate.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Cabo San Lucas.
What's the average short-term occupancy in Cabo San Lucas in 2026?
As of early 2026, the average annual occupancy rate for short-term rentals in Cabo San Lucas is around 50% to 55%, though this varies significantly by property quality and location.
Most short-term rentals in Cabo San Lucas experience an occupancy range of 35% to 60% annually, with well-managed units in prime locations consistently outperforming the average.
The months with the highest occupancy rates for short-term rentals in Cabo San Lucas are December through March, when winter travelers from the US and Canada flock to the destination and occupancy can exceed 70% to 80%.
The months with the lowest occupancy rates for short-term rentals in Cabo San Lucas are typically August and September, when hurricane season concerns and hot weather reduce tourist arrivals and occupancy can drop below 35%.
Finally, please note that you can find much more granular data about this topic in our property pack about Cabo San Lucas.
What's the average nightly rate in Cabo San Lucas in 2026?
As of early 2026, the average nightly rate for short-term rentals in Cabo San Lucas is around $150 to $250 USD (approximately MXN 2,600 to MXN 4,400 or EUR 140 to EUR 230) for mainstream investor-grade units.
A realistic low-to-high nightly rate range that covers most short-term rental listings in Cabo San Lucas is $80 to $500 USD (approximately MXN 1,400 to MXN 8,750 or EUR 75 to EUR 460), with the wide spread reflecting everything from basic studios to premium ocean-view condos.
The typical nightly rate difference between peak season (December through March) and off-season (August through September) in Cabo San Lucas is around $75 to $150 USD (approximately MXN 1,300 to MXN 2,600 or EUR 70 to EUR 140), with peak-season rates often 40% to 60% higher than off-season.
Is short-term rental supply saturated in Cabo San Lucas in 2026?
As of early 2026, the short-term rental market in Cabo San Lucas is competitive but not fully saturated, with room for well-located and well-managed properties to perform strongly.
The number of active short-term rental listings in Cabo San Lucas has been growing steadily, with the Los Cabos Tourism Observatory noting increases in online platform supply, though demand growth has largely kept pace.
The neighborhoods in Cabo San Lucas that are most oversaturated with short-term rentals are the immediate El Medano beachfront and parts of the Marina district, where supply has grown fastest and competition for bookings is fiercest.
Neighborhoods in Cabo San Lucas that still have room for new short-term rental supply include El Tezal, Cabo Bello, and some of the Corridor areas between Cabo San Lucas and San Jose del Cabo, where demand is solid but supply has not yet caught up.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Cabo San Lucas, we always rely on the strongest methodology we can and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| Mexico SRE (Fideicomiso Rules) | Official federal rules for foreign property ownership in coastal zones. | We used it to confirm how foreigners legally hold property via bank trusts in Cabo San Lucas. We also used it to explain why direct title is not available in coastal areas. |
| Los Cabos Tourism Observatory (FITURCA) | Official tourism trust producing destination-specific data monthly. | We used it to ground Cabo's tourism strength, seasonality, and hotel occupancy trends. We also used it to validate STR demand signals and explain peak vs off-season dynamics. |
| AirDNA (Cabo San Lucas STR Data) | Leading short-term rental analytics with consistent methodology across markets. | We used it to estimate STR occupancy, nightly rates, and revenue potential. We also used it to assess market saturation by comparing supply and demand metrics. |
| Global Property Guide (Mexico Yields) | Long-running property data publisher with disclosed methodology. | We used it to anchor Mexico-wide yield benchmarks before adjusting for Cabo's tourism premium. We also used it to avoid overstating yield claims without cross-market context. |
| Banco de Mexico (Exchange Rates) | Mexico's central bank and the official source for FX references. | We used it to frame currency reality for foreign owners budgeting in USD. We also used it as the reference point for converting MXN costs consistently throughout the article. |
| Baja California Sur Civil Code | Primary legal text for civil matters including leasing rules in the state. | We used it to support state-level lease framework points and deposit practices. We also used it to translate legal rules into practical guidance for landlords. |
| IDC Online (Lease Duration Guide) | Widely used professional compliance publisher with cited legal references. | We used it to pinpoint Baja California Sur's lease-duration rule and its cited article number. We then cross-checked that point back to the legal text itself. |
| Los Cabos Municipal Treasury | Official municipal site for Los Cabos permitting requirements. | We used it to explain that operating a rental activity locally ties to municipal permits. We also used it to guide readers toward the correct licensing procedures. |
| Airbnb Mexico Tax Resource Center | Dedicated Airbnb tax education hub written for Mexico compliance. | We used it to explain VAT and lodging tax flows on platform bookings. We also used it to illustrate how missing tax IDs can change withholding behavior for hosts. |
| INEGI (Consumer Price Index) | Mexico's national statistics agency and the official inflation benchmark. | We used it to explain inflation pressure on operating costs and rent negotiations. We also used it to keep cost growth assumptions realistic for early 2026. |
We have made this infographic to give you a quick and clear snapshot of the property market in Mexico. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.