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
Cabo San Lucas sits inside Mexico's constitutionally protected "restricted zone," which means foreigners cannot own coastal land directly but can still purchase condos, houses, and villas through a legal bank trust called a fideicomiso.
This guide covers the ownership rules, visa requirements, buying process, taxes, and mortgage options that apply specifically to foreign buyers in Cabo San Lucas as of the first half of 2026.
We update this blog post regularly to reflect the latest changes in local regulations, tax rates, and market conditions.
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
- Annual property tax (predial) in Cabo San Lucas runs only about 0.1% of assessed value, which means a $500,000 condo might cost you just $300 to $500 per year in property taxes.
- The fideicomiso trust costs around $1,500 to $3,000 to set up plus $500 to $1,000 annually in bank maintenance fees, making it a predictable recurring expense foreign buyers often underestimate.
- Los Cabos increased its acquisition tax (ISABI) to 3% in 2024, so closing costs now typically run 6% to 10% of the purchase price for foreign buyers.
- Non-resident landlords in Cabo San Lucas face a flat 25% withholding tax on gross rental income with zero deductions allowed, meaning a $2,000 monthly rent yields only $1,500 after federal tax.
- Mortgage rates for foreigners buying in Cabo San Lucas range from 9% to 14% for peso loans and 5% to 9% for USD cross-border loans, both significantly higher than typical North American rates.
- The fideicomiso trust lasts 50 years and is renewable indefinitely, so foreign ownership in Cabo San Lucas is effectively permanent rather than a temporary arrangement.
- Short-term rentals in Baja California Sur trigger an additional 3% state lodging tax on gross rental income, stacking on top of the 25% federal income tax for non-residents.
- Foreign buyers paying property tax (predial) in January 2026 receive a 20% early payment discount in Los Cabos, dropping to 10% by March.
- Cash purchases dominate the Cabo San Lucas foreign buyer market because mortgage qualification requires either Mexican residency, local income history, or working with specialized cross-border lenders.
What can I legally buy and truly own as a foreigner in Cabo San Lucas?
What property types can foreigners legally buy in Cabo San Lucas right now?
Foreigners can legally buy condos, apartments, single-family homes, villas, and townhouses in Cabo San Lucas, covering essentially the same residential inventory available to Mexican citizens.
The key condition is that Cabo San Lucas sits inside Mexico's "restricted zone" (within 50 kilometers of the coast), so foreigners must hold residential property through a fideicomiso, which is a bank trust where a Mexican bank holds legal title while you retain full beneficial ownership rights.
This fideicomiso structure gives you the right to use, improve, rent out, sell, and pass the property to your heirs, making it functionally equivalent to direct ownership for practical purposes.
The trust is valid for 50 years and renewable indefinitely, so your ownership in Cabo San Lucas can last as long as you want it to.
Finally, please note that our pack about the property market in Cabo San Lucas is specifically tailored to foreigners.
Can I own land in my own name in Cabo San Lucas right now?
No, foreigners cannot own residential land directly in their personal name in Cabo San Lucas because the city falls within Mexico's constitutionally restricted coastal zone.
The standard legal alternative is the fideicomiso (bank trust), where a Mexican bank holds legal title as trustee while you are named as the beneficiary with full ownership rights to use, sell, rent, and inherit the property.
This trust structure has been the established path for foreign ownership in Cabo San Lucas for over 50 years, and thousands of American, Canadian, and European buyers use it successfully to own coastal property in Mexico.
As of 2026, what other key foreign-ownership rules or limits should I know in Cabo San Lucas?
As of early 2026, one of the most important practical rules in Cabo San Lucas is the "ejido land" risk, where some properties sit on historically communal land with unclear or incomplete title histories that foreigners should avoid entirely.
There is no foreign-ownership quota for apartments or condos in Cabo San Lucas, meaning buildings can be 100% foreign-owned through fideicomisos without any nationality restrictions.
The main registration requirement is that your fideicomiso must be permitted through Mexico's Ministry of Foreign Affairs (SRE), which issues the authorization for restricted-zone trusts and records key details like the property location, trustee bank, and trust duration.
There are no major regulatory changes expected for 2026 that would affect the fundamental ownership structure, though Los Cabos did increase its acquisition tax (ISABI) to 3% in late 2024, which remains in effect.
What's the biggest ownership mistake foreigners make in Cabo San Lucas right now?
The biggest ownership mistake foreigners make in Cabo San Lucas is assuming that seller paperwork and agent assurances are enough, without investing in proper registry-level verification of title and liens.
If you skip due diligence and buy a property with hidden liens, disputed title, or ejido land issues, you could face legal disputes that freeze your ability to sell, rent, or even occupy the property you thought you owned.
Other classic pitfalls in Cabo San Lucas include underestimating HOA fees (which can exceed property taxes in many condo buildings), failing to budget for annual fideicomiso maintenance costs, and not verifying that short-term rental use is actually permitted by the condo regime or local zoning.
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.
Which visa or residency status changes what I can do in Cabo San Lucas?
Do I need a specific visa to buy property in Cabo San Lucas right now?
You do not need a specific visa to buy property in Cabo San Lucas, and yes, you can legally sign a purchase agreement while in Mexico on a tourist visa.
The most common administrative hurdle that blocks buyers without local residency is opening a Mexican bank account, which some banks require for utility payments, HOA transfers, or holding purchase funds during closing.
You do not strictly need a Mexican tax ID (RFC) before buying, but if you plan to rent out the property and earn income, obtaining an RFC becomes essentially unavoidable for tax compliance.
A typical document set for foreign buyers includes your passport, proof of address in your home country, the fideicomiso permit from the SRE, and sometimes a CURP (Mexico's personal ID number) if you are establishing longer-term financial accounts.
Does buying property help me get residency and citizenship in Cabo San Lucas in 2026?
As of early 2026, buying property in Cabo San Lucas does not automatically grant you Mexican residency or citizenship, and Mexico does not have a "golden visa" program that awards residency based on real estate investment alone.
Your property ownership can support a residency application by demonstrating ties to Mexico, but the actual pathways to temporary or permanent residency are based on separate criteria like financial solvency (proving sufficient income or savings), family connections to Mexican citizens, or employment.
For permanent residency, you typically need to hold temporary residency for four consecutive years, or qualify through retirement income thresholds, family ties, or points-based criteria that do not depend on property ownership.
We give you all the details you need about the different pathways to get residency and citizenship in Cabo San Lucas here.
Can I legally rent out property on my visa in Cabo San Lucas right now?
Your visa status does not directly prevent you from renting out property in Cabo San Lucas, but earning rental income in Mexico triggers tax obligations that require proper registration with Mexico's tax authority (SAT).
You do not need to live in Mexico to rent out your Cabo San Lucas property, and many foreign owners manage rentals remotely through local property management companies that handle tenant communications, maintenance, and tax withholding.
The key details foreigners must know are that non-residents face a flat 25% withholding tax on gross rental income with no deductions allowed, and short-term vacation rentals in Baja California Sur also trigger a 3% state lodging tax on top of federal income tax.
We cover everything there is to know about buying and renting out in Cabo San Lucas here.
Get fresh and reliable information about the market in Cabo San Lucas
Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.
How does the buying process actually work step-by-step in Cabo San Lucas?
What are the exact steps to buy property in Cabo San Lucas right now?
The standard buying sequence in Cabo San Lucas goes: find a property and negotiate price, sign a promissory agreement with deposit, conduct due diligence (title, liens, HOA documents), set up the fideicomiso trust with SRE permit, close with a notary (escritura signing), and finally register the property and transfer utilities.
You do not have to be physically present for every step because many foreign buyers use a power of attorney (poder notarial) to authorize a representative to sign documents on their behalf, though being present for key moments like notary signing can reduce friction.
The deal typically becomes legally binding when you sign the promissory purchase agreement (contrato de promesa) and pay the deposit, which is usually 5% to 10% for existing properties or higher for pre-construction.
From accepted offer to final registration, expect a timeline of 45 to 90 days in Cabo San Lucas, with the fideicomiso permit and notary process often being the longest parts.
We have a document entirely dedicated to the whole buying process our pack about properties in Cabo San Lucas.
Is it mandatory to get a lawyer or a notary to buy a property in Cabo San Lucas right now?
A Mexican notary (notario público) is functionally mandatory in Cabo San Lucas because they are the only professionals authorized to formalize the property transfer, calculate taxes, and register the transaction with the public registry.
The key difference is that the notary acts as a neutral government-appointed official who handles the legal formalization of the sale for both parties, while a private lawyer represents your interests specifically and can review contracts, negotiate terms, and flag risks before you commit.
One critical item to include in your lawyer's scope is a thorough title search and lien check (Certificado de Libertad de Gravamen) before you sign any binding agreement, because fixing title problems after closing is far more expensive and complicated than catching them upfront.
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 checks should I run so I don't buy a problem property in Cabo San Lucas?
How do I verify title and ownership history in Cabo San Lucas right now?
The official registry to verify title and ownership history in Cabo San Lucas is the Public Registry of Property (Registro Público de la Propiedad) for Baja California Sur, which maintains the legal record of all property transfers, owners, and encumbrances.
The key document to request is the Certificado de Libertad de Gravamen (certificate of freedom from liens), which is an official state-issued certificate confirming the current owner and whether any debts, mortgages, or legal claims are attached to the property.
A realistic look-back period for ownership history checks in Cabo San Lucas is 10 to 20 years, which allows you to verify that the chain of title is clean and that prior transfers were properly documented.
One clear red flag that should stop or pause your purchase is any gap or irregularity in the ownership chain, such as missing transfers, conflicting ownership claims, or properties that were never properly registered after a previous sale.
You will find here the list of classic mistakes people make when buying a property in Cabo San Lucas.
How do I confirm there are no liens in Cabo San Lucas right now?
The standard way to confirm there are no liens on a property in Cabo San Lucas is to obtain a Certificado de Libertad de Gravamen from the Baja California Sur Public Registry, which is an official government certificate that lists any mortgages, judgments, or encumbrances recorded against the property.
One common type of lien to specifically ask about in Cabo San Lucas is unpaid HOA fees or special assessments, because these debts can transfer to the new owner and are not always captured in the standard registry certificate.
The single best form of written proof is the Certificado de Libertad de Gravamen itself, which your notary or lawyer should obtain as a fresh document (typically valid for 15 to 30 days) close to your closing date to ensure nothing new has been recorded.
How do I check zoning and permitted use in Cabo San Lucas right now?
The authority to check zoning and permitted use in Cabo San Lucas is the municipal government (Ayuntamiento de Los Cabos), specifically the urban development or land use planning department that administers zoning classifications.
The document that typically confirms zoning classification is the constancia de uso de suelo (land use certificate) or the property's designation in the municipal development plan, which your notary or lawyer can request as part of due diligence.
One common zoning pitfall that foreign buyers miss in Cabo San Lucas is assuming that a condo can be used for short-term vacation rentals, when in fact many condo regimes or HOA bylaws prohibit or restrict rentals under 30 days regardless of what municipal zoning allows.
Buying real estate in Cabo San Lucas can be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
Can I get a mortgage as a foreigner in Cabo San Lucas, and on what terms?
Do banks lend to foreigners for homes in Cabo San Lucas in 2026?
As of early 2026, yes, foreigners can get mortgages for homes in Cabo San Lucas, but your options are more limited than for Mexican nationals, and cash purchases remain the most common path for foreign buyers.
The realistic loan-to-value (LTV) range for foreign borrowers in Cabo San Lucas is 50% to 70%, meaning you should expect to put down 30% to 50% of the purchase price as a down payment.
The most common eligibility requirement that determines whether a foreigner qualifies is proof of stable income, and many Mexican banks additionally require Mexican residency or local income history, which pushes non-resident buyers toward specialized cross-border lenders.
You can also read our latest update about mortgage and interest rates in Mexico.
Which banks are most foreigner-friendly in Cabo San Lucas in 2026?
As of early 2026, the most foreigner-friendly lenders for mortgages in Cabo San Lucas are cross-border specialists like MoXi (Global Mortgage) and MEXLend that focus specifically on US and Canadian buyers, plus major Mexican banks like BBVA and Banorte that have programs for foreigners or Mexicans living abroad.
The single most important feature that makes these lenders more foreigner-friendly is their willingness to underwrite based on foreign credit history and income documentation rather than requiring Mexican residency or a local employment record.
For non-residents without Mexican residency, the cross-border lenders are typically your best option because traditional Mexican banks often require residency status or local income proof that non-resident buyers cannot provide.
We actually have a specific document about how to get a mortgage as a foreigner in our pack covering real estate in Cabo San Lucas.
What mortgage rates are foreigners offered in Cabo San Lucas in 2026?
As of early 2026, foreigners can expect mortgage interest rates of 9% to 14% APR for Mexican peso loans, or 5% to 9% for USD-denominated cross-border loans from specialized lenders serving US and Canadian buyers.
The typical difference between fixed-rate and variable-rate mortgages is that fixed rates in Mexico tend to be 1 to 2 percentage points higher than variable rates at origination, but variable rates are tied to benchmarks like TIIE (Mexico's interbank rate) and can increase if interest rates rise.
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.
What will taxes, fees, and ongoing costs look like in Cabo San Lucas?
What are the total closing costs as a percent in Cabo San Lucas in 2026?
The typical total closing cost for foreign buyers in Cabo San Lucas in 2026 is around 8% of the purchase price, which is a solid planning number for budgeting purposes.
The realistic range is 6% to 10% depending on the property price, whether you need a new fideicomiso setup, and how notary and legal fees are negotiated.
The specific fee categories that make up closing costs in Cabo San Lucas include the acquisition tax (ISABI), notary fees, public registry fees, appraisal costs, fideicomiso setup and SRE permit fees, and sometimes title insurance or legal representation fees.
The single biggest contributor to closing costs is usually the acquisition tax (ISABI), which Los Cabos now charges at 3% of the higher of the purchase price or assessed value.
If you want to go into more details, we also have a blog article detailing all the property taxes and fees in Cabo San Lucas.
What annual property tax should I budget in Cabo San Lucas in 2026?
As of early 2026, the typical annual property tax (predial) budget for a standard owner-occupied home in Cabo San Lucas is around 0.1% to 0.3% of the assessed value, which for a $500,000 property works out to roughly $500 to $1,500 USD (around 9,000 to 27,000 MXN or 450 to 1,400 EUR) per year.
Property tax in Cabo San Lucas is assessed as a percentage of the cadastral (assessed) value determined by the municipal registry, not the market price, and Los Cabos offers early payment discounts of 20% in January and February, dropping to 10% in March.
How is rental income taxed for foreigners in Cabo San Lucas in 2026?
As of early 2026, the effective tax rate on rental income for non-resident foreigners in Cabo San Lucas is 25% of gross rental income, with no deductions allowed for expenses like property management, maintenance, or HOA fees.
The basic filing requirement is that the tenant or property manager must withhold 25% from each rental payment and remit it to Mexico's tax authority (SAT) by the 17th of the following month, making compliance relatively automatic if you use a professional property manager.
What insurance is common and how much in Cabo San Lucas in 2026?
As of early 2026, the typical annual insurance premium for a standard home policy in Cabo San Lucas ranges from 0.2% to 1.0% of the insured value, which for a $500,000 property works out to roughly $1,000 to $5,000 USD (around 18,000 to 90,000 MXN or 900 to 4,600 EUR) per year depending on property type and coverage level.
The most common type of property insurance coverage that owners carry in Cabo San Lucas is a comprehensive homeowners policy that covers the structure, contents, liability, and named perils including fire and theft.
The biggest factor that makes insurance premiums higher or lower in Cabo San Lucas is hurricane and flood coverage, because the coastal location and storm exposure significantly affect risk pricing, and some policies exclude or limit wind damage unless you pay for enhanced coverage.
Get the full checklist for your due diligence in Cabo San Lucas
Don't repeat the same mistakes others have made before you. Make sure everything is in order before signing your sales contract.
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's Ministry of Foreign Affairs (SRE) | It's the federal body that issues permits for restricted-zone fideicomisos. | We used it to anchor the fideicomiso as the official path for foreigners buying in coastal Cabo. We also referenced it for permit timing and requirements. |
| Mexican Constitution Article 27 | It's the primary constitutional text defining restricted zone rules. | We used it to explain why Mexico treats coastal land differently for foreign ownership. We referenced it as the legal foundation for the fideicomiso requirement. |
| Foreign Investment Law (Ley de Inversión Extranjera) | It's the official federal law text governing foreign investment in Mexico. | We used it to ground the legal basis for fideicomisos in the restricted zone. We ensured our guidance aligns with actual law rather than market folklore. |
| SAT (Mexico Tax Authority) | It's the official tax authority explaining tax treatment for foreigners. | We used it for the 25% non-resident rental income tax rule. We avoided relying on blogs for core tax claims by going to the source. |
| SAT RFC Registration for Foreigners | It's SAT's official procedure for foreigners to register a tax ID. | We used it to explain when an RFC becomes necessary, especially for rental income. We framed the RFC as a compliance requirement, not optional. |
| Los Cabos Municipal Government | It's the official municipal source for property tax discounts effective January 2026. | We used it to confirm predial discount schedules and date-stamp our guide as current for January 2026. |
| Baja California Sur State Government | It's the official state procedure for the lien certificate (Certificado de Libertad de Gravamen). | We used it to explain the official due diligence step for verifying liens. We showed this is a concrete government service, not a vague concept. |
| BCS Lodging Tax Procedure | It's the official state description of the lodging tax scope. | We used it to explain that short-term rentals trigger state lodging tax obligations. We tied vacation rental tax talk to a government statement. |
| CONDUSEF Mortgage Simulator | It's Mexico's official consumer financial protection agency comparing mortgage offers. | We used it to ground our mortgage rate discussion in a regulator-run comparison tool. We referenced it so readers can verify bank claims themselves. |
| Bank of Mexico (Banxico) TIIE Rates | It's the central bank's published reference rate series. | We used it to explain why Mexican mortgage rates are higher than US or Canadian rates. We anchored our 2026 rate estimates to this public benchmark. |
| BBVA Mexico | It's a major Mexican bank describing the fideicomiso trust product. | We used it to confirm how banks describe and implement the restricted-zone fideicomiso. We corroborated government text with real-world bank practice. |
| Banorte | It's another major Mexican bank with fideicomiso services for foreigners. | We used it to cross-check BBVA's framing and explain resale mechanics via trust assignment. We reduced single-bank bias in our fideicomiso descriptions. |
| Mexperience | It's a long-running Mexico expat resource that's widely referenced and regularly updated. | We used it to describe common insurance coverages and why policy wording matters in Mexico. We applied it as a reality check for practical budgeting. |
| Zeta Tijuana | It's regional journalism covering Los Cabos municipal finance changes. | We used it to verify the ISABI acquisition tax increase to 3% in Los Cabos. We anchored our closing cost estimates to this local reporting. |
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.