Everything You Need to Know About Investing in Real Estate in Cabo San Lucas

Cabo San Lucas has long been a destination of choice for luxury travelers, but over the last decade, it’s also become a serious opportunity for real estate investors. With strong rental demand, attractive property values, and an international buyer base, investing in Cabo San Lucas offers both lifestyle benefits and income potential. Whether you're seeking a vacation home that pays for itself or looking to diversify your portfolio globally, Cabo delivers on every level.

Cabo's appeal goes far beyond its beaches. The region offers a rare combination of natural beauty, luxury infrastructure, and a pro-investment climate that’s drawing attention from buyers across North America and beyond. What makes investing in Cabo San Lucas particularly attractive is its balance of vacation-home lifestyle with solid ROI.

Here’s why Cabo continues to stand out:

• Year-Round Tourism: With over 300 sunny days per year and consistent flight access from major U.S. cities, Cabo attracts visitors in every season.
  
  
• Strong Short-Term Rental Market: Vacation rentals are in high demand, especially in areas like Pedregal, Cabo del Sol, and the marina district.
  
  
• Currency Advantage: For many international investors, the dollar goes further in Mexico, yet the luxury amenities and appreciation potential are competitive with those of U.S. coastal cities.
  
  
• Stable Growth: The local government has supported real estate development with improved infrastructure and increased foreign investment protection.

Yes, and they’ve been doing so for decades. Foreigners can legally own property in Cabo through a bank trust known as a fideicomiso, or by forming a Mexican corporation in some cases (usually for commercial property).

Here’s how it works:

• If the property is within the restricted zone (within 50 km of the coast or 100 km from a border), foreign buyers must use a fideicomiso.
  
  
• This is a trust agreement with a Mexican bank, where the buyer retains all ownership rights, including the right to sell, lease, or improve the property.
  
  
• The trust is renewable every 50 years and is considered a secure, standard method for foreign ownership.

Working with a trusted real estate advisor and legal team ensures this process is seamless and compliant. The team at Oceanside Real Estate Group has helped numerous international clients navigate these steps with confidence.

One of the biggest advantages of investing in Cabo San Lucas is the wide variety of property options, depending on your goals.

Some popular choices include:

• Luxury Villas: Often located in gated communities with private beach access, pools, and concierge services, these are ideal for short-term rentals or private retreats.
  
  
• Condos: Found near the marina, downtown, or beachfront, condos are popular for rental income and lock-and-leave convenience.
  
  
• Lots and Land: For investors interested in custom building or development, there are still prime lots available with ocean views.
  
  
• Commercial and Mixed-Use Spaces: With growth in retail and hospitality, some investors are turning to commercial properties for long-term leasing.

Buyers looking for passive income often favor condos in tourist-heavy zones, while long-term investors may prefer land banking or boutique hotel development.

Many property owners in Cabo use their homes as vacation getaways while generating rental income the rest of the year. With platforms like Airbnb and local vacation rental services, it’s easier than ever to monetize a property.

Key points to keep in mind:

• High Season runs from November through April, including holidays and spring break, with premium nightly rates.
  
  
• Rental Management Services are widely available and can handle bookings, maintenance, cleaning, and guest communication.
  
  
• HOAs and Local Regulations may affect rental operations, so it’s important to review any restrictions before purchasing.
  
  
• Taxes on Rental Income must be reported and paid either in Mexico or in your home country, depending on your tax residency.

The team at Oceanside Real Estate Group can help you forecast realistic rental income, compare historical performance in different areas, and connect you with management professionals.

Financing in Cabo San Lucas is available, but most buyers choose to pay in cash or arrange financing in their home country.

Costs to be aware of:

• Closing Costs typically range from 5%–8% of the purchase price, including notary fees, transfer taxes, and trust setup (if applicable).
  
  
• HOA Fees vary widely depending on amenities, security, and location—luxury communities may charge several hundred dollars per month.
  
  
• Maintenance & Utilities are generally lower than in U.S. markets but should still be budgeted, especially for oceanfront properties.
  
  
• Capital Gains Tax may apply when selling, though strategies are available to minimize this with professional advice.

An experienced local advisor will ensure that you understand the full cost picture before making a decision.

Different areas of Cabo cater to different types of investors:

• Pedregal is a gated hillside enclave known for dramatic ocean views, privacy, and strong short-term rental demand.
  
  
• Cabo San Lucas Marina & Downtown offer excellent walkability and consistent rental occupancy, ideal for condos and turnkey units.
  
  
• Cabo del Sol is home to world-class golf and master-planned communities that appeal to luxury buyers and vacationers alike.
  
  
• Corridor to San José del Cabo features beachfront resorts, residential enclaves, and rising demand for new builds.

Each area offers different strengths in terms of appreciation, rental income, and lifestyle access. The right fit depends on your goals, whether that's income generation, second-home living, or long-term growth.

When buying internationally, having the right real estate advisor is critical. From navigating legal requirements to identifying the best properties and managing the purchase process, a local expert brings value at every step.

Oceanside Real Estate Group has extensive experience working with both domestic and international investors. Their team offers personalized support, market insight, and access to the region’s most desirable listings, many of which are off-market or move quickly. With their guidance, you’ll feel confident and informed throughout your investment journey.

Whether you’re looking to diversify your portfolio, generate passive income, or secure a vacation property that pays for itself, investing in Cabo San Lucas is a smart move in a stable and growing market.

The team at Oceanside Real Estate Group is here to help you find the right property, navigate the buying process, and unlock the full potential of real estate ownership in Cabo. Contact them today to begin your investment journey with local expertise and a global perspective.