2021 was the hottest year in the history of the Real Estate market of Los Cabos.
For the first time, it was a seller’s market, with the number of single-family home transactions rising 126% and a median price gain of 49% year over year.
Condo transactions soared 192% with a median price gain of 19%. Any backlog in preconstruction and predevelopment inventory also flew off the shelves, while growth expanded further outside the Los Cabos area. The Four Seasons, located over an hour away, had great success in terms of residential sales.
The Baja Sur capital of La Paz and the artsy surf town of Todos Santos also saw significant growth in demand for residential offerings. What was once primarily a residential destination for buyers from the U.S West Coast is now attracting more owners from all over the country, including New York and Chicago.
They were joined by Mexican buyers snapping up investment properties to capitalize on the vacation rental industry, which was off the charts in 2021, squeezing out hopes of finding a long-term lease in the area. Buyers across the market were willing to pay a premium for turnkey offerings and leaned more toward contemporary designs that infused Mexican elements throughout.
No cooldown is expected in 2022 as buyers priced out of the U.S. market dip their toes in the waters south of the border to take advantage of the income-producing vacation rental market. They may find prices higher than expected as the Baja Sur lifestyle is in increasingly high demand.
People looking to rent in the short- or long-term won’t find much available, and will likely have to buy to get in on the action.