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
Where are the best places to invest in Cabo San Lucas right now? Is the downtown area still the top pick, or are neighborhoods like Pedregal, El Tezal, and the Tourist Corridor gaining ground? What makes these locations attractive to both local and foreign investors?
We’re often asked these questions because we work directly with notaries, real estate agents, and clients who invest across the region. Our firsthand experience in these markets gives us unique insights into where the real opportunities lie. To save everyone from asking privately, we’ve written this article to share our knowledge broadly.
Our goal is to highlight the hottest markets in Cabo San Lucas and explain why they’re worth your attention in 2025.
If you have suggestions or want us to dive deeper into a specific area, let us know. You shoot an email, we answer within 24 hours.
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1) Cabo Bello is thriving with its gated community vibe and high demand for vacation rentals
Cabo Bello is a hotspot for those craving a gated community vibe and a booming vacation rental market.
In 2023, vacation rentals in Cabo San Lucas had a 56% median occupancy rate, with properties booked for about 204 nights annually. This shows a strong demand for vacation rentals, making Cabo Bello a prime choice for investors.
Property values in Cabo Bello are on the rise, adding to its allure. The median price for a 2-bedroom property has hit $328,677, reflecting the area's growing real estate market. Investing here is lucrative, with Airbnb rentals bringing in around $41,900 annually.
The number of short-term rental listings in Cabo Bello is climbing, showing its increasing popularity. By September 2024, Cabo San Lucas had 1,210 active Airbnb listings, with significant growth in areas like El Tezal and Punta Arena. This trend highlights the area's potential for vacation rentals.
Many property owners are catching on to the demand in Cabo Bello, recognizing the opportunity for profitable vacation rentals. The area's appeal is evident in the rising number of listings and the steady increase in property values.
For those looking to invest in a vacation rental, Cabo Bello offers a promising market with its high occupancy rates and increasing property values. The gated community feel adds to its charm, making it a sought-after location.
Sources: Airbtics, Airbtics, GlobeNewswire
2) Marina District is thriving with vibrant nightlife and high short-term rental occupancy rates
The Marina District in Cabo San Lucas is buzzing with vibrant nightlife and high occupancy rates for short-term rentals.
In 2023, short-term rentals in this area were typically booked for 204 nights a year, with a median occupancy rate of 56%. This shows a strong demand for places to stay, making it a lucrative spot for property owners looking to cash in.
On average, hosts in the Marina District charged MXN1,647 per night for their rentals, raking in an average annual revenue of MXN302K. This financial potential is a magnet for investors, adding to the district's booming reputation. The overall tourism growth in Los Cabos, with more visitors flocking in 2023, hints at a lively nightlife scene in the Marina District.
The real estate market in Cabo San Lucas, especially in the Marina District, has seen significant growth. Over the past seven years, six thousand new rooms have been added, boosting the area's popularity and property values. Although there was a temporary dip in short-term rental revenue due to oversupply, the market is expected to bounce back as it adjusts.
For those considering buying property here, the Marina District offers a unique blend of investment potential and lifestyle appeal. The district's vibrant nightlife and high occupancy rates make it a prime location for short-term rental investments.
With its bustling atmosphere and financial opportunities, the Marina District is a hotspot for both tourists and property investors. The area's growth and popularity are set to continue, making it an exciting place to be.
Sources: Airbtics, Visit Los Cabos, Nayahomes
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.
3) Santa Carmela is gaining interest for its exclusive beachfront properties and strong appreciation potential
Santa Carmela is a hot spot for those eyeing exclusive beachfront properties with promising appreciation potential.
Over the past four years, property values in Santa Carmela have consistently climbed, with annual appreciation rates hitting 8%. This steady rise is fueled by a strong demand for luxury homes and investment properties. The scarcity of beachfront properties in such a coveted area adds to the upward pressure on prices, making Santa Carmela a prime choice for buyers.
The Mexican government is also playing a significant role in boosting property values here. With investments in infrastructure, like road improvements and federal funds for local development, the area is becoming even more appealing to investors. These enhancements are not just about convenience; they are about increasing the area's allure and value.
Santa Carmela's reputation is further bolstered by media coverage, which often highlights it as a top investment destination. The buzz around its exclusive beachfront properties and strong appreciation potential is drawing more investors to the area, eager to capitalize on its growth.
For those considering a purchase, it's worth noting that the limited availability of properties in Santa Carmela is a key factor in its desirability. This scarcity, combined with the area's natural beauty and strategic location, makes it a standout choice for property investment.
Investors are not just buying homes; they are buying into a lifestyle and a community that promises both luxury and a solid return on investment. With the ongoing developments and the area's inherent charm, Santa Carmela is poised for continued growth.
Sources: Find Mexico Houses, Baja Investments, Own in Cabo
4) Pedregal is drawing investors with its luxury homes, high rental yields, and stunning ocean views
Pedregal is a hotspot for investors thanks to its luxury homes, high rental yields, and breathtaking ocean views.
One of the key attractions is the community's acceptance of short-term rentals, which gives homeowners the flexibility to earn income through vacation rentals. This flexibility leads to high occupancy rates, making Pedregal a standout location for generating rental income.
Properties in Pedregal offer above-average rental yields compared to other areas in Cabo San Lucas. Its exclusive nature and proximity to downtown make it a magnet for tourists and high-net-worth individuals, enhancing its appeal.
Pedregal boasts a strong historical appreciation, with an average year-over-year increase of about 11% over the past 35 years. This consistent growth in value makes it a smart long-term investment for those looking to invest in real estate.
Property owners often share glowing testimonials about the high rental potential. For instance, properties like Villa Marcella are popular for hosting events such as weddings and beach parties, indicating a strong demand for luxury rentals.
The community's mix of opulence, natural beauty, and cultural allure draws buyers from around the globe, especially those seeking luxury homes with ocean views. This international interest further boosts the area's attractiveness.
Sources: Own in Cabo, Windermere Los Cabos, Pedregal de Cabo San Lucas
5) Ventanas Residences is gaining attention for its modern amenities and potential for long-term rental income
Ventanas Residences is catching eyes for its modern amenities and rental income potential.
In recent years, property values in the area have been on the rise, especially in newer phases like Phase 3, which boast modern features that naturally drive up prices. This trend reflects a growing demand, making it a hot spot for those looking to invest in real estate.
Cabo San Lucas, with its year-round sunshine and vibrant tourist scene, ensures that Ventanas Residences enjoys high occupancy rates for short-term rentals. The steady stream of visitors and glowing reviews on rental platforms underscore the appeal of these properties for vacationers.
Ventanas Residences offers a range of community amenities, including a gym, spa, pool, and clubhouse, which enhance the living experience for both buyers and renters. The added security of a gated community with 24/7 surveillance makes it an attractive option for those seeking peace of mind.
Investors are particularly drawn to the potential for long-term rental income, as the area continues to develop and attract more interest. The combination of modern living spaces and a thriving rental market makes Ventanas Residences a smart choice for investment.
With its strategic location and comprehensive amenities, Ventanas Residences stands out as a preferred choice for residents and investors alike, offering a blend of comfort and opportunity.
Sources: Own In Cabo Real Estate, Pre Construction in Cabo San Lucas, Los Cabos tourism growth focused on quality over quantity
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6) El Tezal is booming with rapid property appreciation and its proximity to the beach and downtown Cabo San Lucas
El Tezal is a hot spot for property buyers, thanks to its rapidly rising property values and prime location.
In recent years, especially in 2023 and 2024, El Tezal has seen a notable surge in luxury property prices. This boom is fueled by affluent buyers who are drawn to the area's unique charm and offerings. The allure of El Tezal lies in its perfect blend of tranquility and convenience, making it a top choice for those looking to invest in a home.
One of the biggest draws of El Tezal is its close proximity to both the beach and downtown Cabo San Lucas. Residents enjoy easy access to the highway, the marina, and a variety of dining options. This makes El Tezal an ideal location for those who want the best of both worlds—peaceful living with the excitement of city life just minutes away.
The area is also seeing a growing number of expatriates and retirees, which is further boosting demand. Many are choosing El Tezal for its excellent location and great value. This influx has made the area increasingly popular as a retirement destination, leading to more interest in both buying and renting residential properties.
Ongoing investments and new developments are also playing a significant role in El Tezal's property appreciation. The area's popularity is not just a passing trend; it's a result of strategic growth and development that continues to attract buyers and investors alike.
With its strategic location and rising property values, El Tezal is a prime example of a thriving real estate market. The combination of high demand and continuous development ensures that this area remains a top choice for property buyers looking for both investment potential and a great place to live.
Sources: Los Cabos Residential Real Estate Market Report 2023 Q2, The Real Estate Market in Cabo San Lucas: 2024 Forecast, Residential Lots For Sale El Tezal Cabo San Lucas
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.
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- Overview of the current state of the real estate market in Cabo San Lucas