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Why buying Baja California real estate is a good investment

Baja California

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Enjoy the ultimate vacation lifestyle when you invest in Baja California real estate.

I. Investing in Los Cabos, Mexico real estate

Los Cabos real estate offers some of the most coveted luxury properties in the world. Here’s why you should consider investing your hard-earned money in the affluent resort towns of Cabo San Lucas, famous for its incredible nightlife, and San Jose del Cabo, the tranquil municipality located 20 miles away. Collectively known as Los Cabos, both towns are found in the Mexican state of Baja California.

  • Prices. Los Cabos offers prime beachfront property at a fraction of the cost of comparable properties in the United States.
  • Desirability. The mild climate, natural scenery, and upscale amenities make the seaside towns two of the most sought after vacation and retirement spots in the world.
  • Growth. The towns have undergone remarkable growth with new construction and the arrival of businesses, including major US chains like Walmart and Costco, while retaining its small town charm.
  • Safety. Los Cabos comprises two of the safest municipalities in Baja California Sur, Mexico. The main road that offers access to Los Cabos is not associated with Mexico’s headline-making drug-related violence. The resorts themselves typically have round the clock security.
  • Quality of life. Those who live here enjoy access to healthcare, legal services, and recreational activities like golfing, boating, fishing, and yes, partying.
  • Cost of living. Estimates show that the cost of living in Los Cabos is roughly 20% to 25% lower than the US or Canada. Inapam card holders enjoy discounts on food, travel, museum tickets, and more.
  • Accessibility. The road to Los Cabos is a scenic 1,059-mile drive along the Baja Peninsula from the city of Tijuana and the US-Mexico border. There are direct flights from San Diego, San Francisco, Los Angeles, and many other cities.

    The Los Cabos International Airport (SJD) serves commercial flights, while the smaller Cabo San Lucas International Airport (CSL) serves private flights.

  • Financing. Buyers only need to secure a “fideicomiso” or a Mexican Property Trust to purchase land in Baja California and many other places in Mexico.

    Mexican peso mortgages are available to foreigners, while a number of smaller US banks and lenders offer mortgage financing and title insurance for foreign-owned properties in the country.

    Buyers can also look into seller financing options, with up to 30% of sellers offering some type of seller financing.

  • Ownership. The Mexican government amended real estate laws in 1994 to allow foreigners to own property by way of a “fideicomiso” within a restricted zone, which extends roughly 60 miles from the national border and within 30 miles of the coast. This zone encompasses nearly all real estate in Los Cabos.

    With a “fideicomiso,” the government issues a permit to the Mexican bank of your choice, allowing them to act as the trustee, with you as the beneficiary. The beneficiary’s rights are the equivalent of estate trusts and living wills in the US and Canada.

II. Buying a house checklist

When buying a home in Cabo, there are several things you must keep in mind:

  • Taxes. Property taxes in Cabo are generally lower than the US. Known as “predial,” property taxes cost roughly 0.08% of the property’s assessed value.
  • Insurance. Home insurance is relatively affordable in Mexico, with a wide range of insurance policies covering property damage, liability, and natural disasters. When buying real estate in Cabo San Lucas, make sure that the payout will be made in US dollars should you make any claims.
  • Financing. Cash deals are more common in Cabo real estate. However, you can apply for US or Mexican mortgages, or inquire about seller financing.
  • Maintenance. When purchasing condos in Cabo, condominium associations typically take over maintenance. For other property types, there are reputable property management companies in Cabo that offer construction, repairs, renovations, and property inspections.
  • Rental income. There’s a high demand for rental homes in Cabo San Lucas. Rentals often have a 70% to 80% occupancy rate when located in a desirable area, and when rented out at competitive rates.
  • Closing. Closing typically takes one to two months.

III. Los Cabos home buying tips

When buying a second home in Los Cabos, it is important to work with a trustworthy real estate advisor who knows the market well. A good advisor is in tune with local laws, practices, and cultural norms, and will guide you accordingly.

Andrew Lemke has extensive knowledge of luxury properties in Cabo San Lucas, with over $400 million in sales to his name. Call him today to find the perfect home.

IV. Los Cabos houses for sale

The Los Cabos Multiple Listings Service (MLS) is your premier source for luxury properties in Cabo, offering a wide selection of single-family homes, townhomes, and condos. The most coveted homes in town command views of the Sea of Cortez.

To gain access to the MLS, get in touch with Andrew Lemke today.
US number: 1.310.922.1818
Mexico number: +52.1.624.122.5658
Email: Andrew(dotted)Lemke(at)EngelVoelkers(dotted)com