The Los Cabos real estate market in May 2025 is thriving, particularly in the luxury segment, driven by strong demand from international buyers, especially from the U.S. and Canada. Here’s a concise overview based on the latest trends and data:
• Market Performance: In Q1 2025, Los Cabos saw a 70% surge in sales volume compared to Q4 2024, with $559 million USD in sales under contract and 391 units sold. The luxury market dominates, with 77% of sales volume from properties over $1 million, including six sales above $10 million, the highest at $28 million. Average home sale prices rose 56% compared to Q1 2024, reflecting robust demand for high-end residences.
• Luxury and Fractional Ownership: The luxury market is expanding, with a projected 15% growth in 2025, fueled by affluent buyers seeking beachfront villas and condos in areas like Chileno Bay, Palmilla, and Puerto Los Cabos. Fractional ownership models, led by companies like Pacaso, are gaining traction, making luxury properties more accessible. These shares average a 14.7% profit upon resale, appealing to both wealthy buyers and those seeking vacation homes.
• Buyer Trends: The market remains a cash-driven, buyer’s market with a record inventory of 2,122 houses and condos valued at $2.616 billion USD. Buyers prioritize lifestyle amenities like golf courses, private beach clubs, and eco-friendly features. Demand for properties with healthcare access is up 15%, reflecting retiree interest, while gated communities are a top choice for security and luxury.
• Investment Opportunities: Los Cabos offers strong ROI through vacation rentals and property appreciation, with tourism (over 4 million visitors annually) driving demand. Neighborhoods like Cabo del Sol, Palmilla, and Club Campestre are highlighted for their rental potential and long-term value. Infrastructure improvements and a stable local economy enhance the region’s appeal.
• Challenges: Rising construction costs and a stronger Mexican peso may increase property prices, but no price drops are expected. Buyers face longer days on market (200–300 days for properties over $2 million) and 633 price reductions in Q1 2025, indicating some negotiation opportunities.
• Events and Insights: The Cabo Real Estate Summit on March 22, 2025, at Diamante Cabo San Lucas will provide networking and market insights, focusing on luxury trends and emerging areas like the East Cape.
For buyers, now is a strategic time to invest due to high inventory and stable market conditions, but working with certified agents (e.g., AMPI-registered) and understanding legal requirements like fideicomiso for coastal properties is crucial. Contact local experts or visit caborealestateservices.com for listings and guidance.